Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2018shares | |
Document And Entity Information [Abstract] | |
Entity Registrant Name | CNFinance Holdings Ltd. |
Entity Central Index Key | 0001733868 |
Trading Symbol | cnf |
Entity Current Reporting Status | Yes |
Entity Voluntary Filers | No |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Non-accelerated Filer |
Entity Well-known Seasoned Issuer | No |
Document Fiscal Year Focus | 2018 |
Document Fiscal Period Focus | FY |
Document Type | 20-F |
Document Period End Date | Dec. 31, 2018 |
Amendment Flag | false |
Entity Common Stock, Shares Outstanding | 1,371,643,240 |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | true |
Entity Shell Company | false |
Consolidated balance sheets
Consolidated balance sheets - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 |
Assets | ||
Cash and cash equivalents (including RMB911,581,943 and RMB2,457,242,507 from structure funds as of December 31, 2017 and 2018, respectively, which could only be used to granting new loans and activities as mentioned in Note 1) | ¥ 3,161,657,934 | ¥ 1,190,360,385 |
Loans principal, interest and financing service fee receivables (net of allowance of RMB440,336,086 and RMB 863,038,604 as of December 31, 2017 and 2018, respectively) | 14,998,285,866 | 16,261,167,957 |
Available-for-sale investments | 682,252,159 | 360,187,885 |
Property and equipment | 19,166,229 | 22,467,900 |
Intangible assets and goodwill | 4,176,244 | 3,342,463 |
Deferred tax assets | 217,615,423 | 112,529,947 |
Deposits | 178,217,958 | 150,325,225 |
Other assets | 93,345,352 | 115,483,728 |
Total assets | 19,354,717,165 | 18,215,865,490 |
Interest-bearing borrowings | ||
Borrowings under agreements to repurchase | 4,213,900,028 | 3,512,114,961 |
Other borrowings | 11,110,876,011 | 12,195,821,217 |
Accrued employee benefits | 42,179,041 | 68,827,798 |
Income tax payable | 689,415,410 | 383,338,483 |
Deferred tax liabilities | 1,305,540 | 776,971 |
Other liabilities | 251,485,755 | 223,737,268 |
Total liabilities | 16,309,161,785 | 16,384,616,698 |
Ordinary shares (3,800,000,000 shares authorized, 1 share with HKD0.0001 as par value and 1,371,643,240 shares with USD0.0001 as par value issued as of December 31, 2017 and December 31, 2018, respectively) | 916,743 | 0 |
Additional paid-in capital | 921,703,448 | 569,125,240 |
Retained earnings | 2,127,501,707 | 1,266,592,996 |
Accumulated other comprehensive losses | (4,566,518) | (4,469,444) |
Total shareholders' equity | 3,045,555,380 | 1,831,248,792 |
Total liabilities and shareholders' equity | ¥ 19,354,717,165 | ¥ 18,215,865,490 |
Consolidated balance sheets (Pa
Consolidated balance sheets (Parentheticals) | Dec. 31, 2018CNY (¥)shares | Dec. 31, 2018$ / shares | Jul. 11, 2018$ / shares | Dec. 31, 2017CNY (¥)shares | Dec. 31, 2017$ / shares | Jan. 08, 2014$ / shares |
Statement of Financial Position [Abstract] | ||||||
Cash and cash equivalents of structure funds | ¥ | ¥ 2,457,242,507 | ¥ 911,581,943 | ||||
Net of allowance for loans principal, interest and financing service fee receivables | ¥ | ¥ 863,038,604 | ¥ 440,336,086 | ||||
Ordinary shares, par value per share (in dollars per share) | (per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||
Ordinary shares, shares authorized | shares | 3,800,000,000 | 3,800,000,000 | ||||
Common stock, shares issued | shares | 1,371,643,240 | 1 |
Consolidated statements of comp
Consolidated statements of comprehensive income - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Interest and fees income | |||
Interest and financing service fee on loans | ¥ 4,278,820,368 | ¥ 3,406,110,592 | ¥ 1,242,128,524 |
Interest on deposits with banks | 13,844,598 | 4,337,177 | 1,417,305 |
Total interest and fees income | 4,292,664,966 | 3,410,447,769 | 1,243,545,829 |
Interest expense | |||
Interest expense on interest-bearing borrowings | (1,942,449,117) | (1,401,191,685) | (442,661,324) |
Interest expense paid to related parties | (610,405) | (8,714,000) | |
Total interest expense | (1,943,059,522) | (1,409,905,685) | (442,661,324) |
Net interest and fees income | 2,349,605,444 | 2,000,542,084 | 800,884,505 |
Provision for credit losses | (433,753,901) | (306,752,951) | (111,362,044) |
Net interest and fees income after provision for credit losses | 1,915,851,543 | 1,693,789,133 | 689,522,461 |
Realized gains/(losses) on sales of investments, net | 3,185,026 | (11,527,798) | 66,878,501 |
Other-than-temporary losses on available-for-sale investments | (36,692,695) | ||
Other gains/(losses), net | (14,582,940) | 23,979,610 | 36,261,933 |
Total non-interest revenue | (11,397,914) | 12,451,812 | 66,447,739 |
Operating expenses | |||
Employee compensation and benefits | (443,071,028) | (545,956,248) | (299,225,819) |
Share-based compensation expenses | (39,715,168) | (182,689,766) | |
Taxes and surcharges | (81,198,115) | (38,835,933) | (48,207,495) |
Rental and property management expenses | (58,317,758) | (47,896,817) | (24,404,690) |
Impairment of goodwill | (20,279,026) | ||
Offering expenses | (10,858,717) | ||
Other expenses | (113,555,657) | (82,194,556) | (75,807,908) |
Total operating expenses | (746,716,443) | (897,573,320) | (467,924,938) |
Income before income tax | 1,157,737,186 | 808,667,625 | 288,045,262 |
Income tax expense | (296,828,475) | (275,994,868) | (52,603,423) |
Net income | ¥ 860,908,711 | ¥ 532,672,757 | ¥ 235,441,839 |
Earnings per share | |||
Basic | ¥ 0.69 | ¥ 0.43 | ¥ 0.19 |
Diluted | ¥ 0.62 | ¥ 0.40 | ¥ 0.19 |
Other comprehensive (losses) / income | |||
Net unrealized (losses) / income on available-for-sale investments | ¥ 1,585,705 | ¥ (2,601,355) | ¥ (194,680,052) |
Foreign currency translation adjustment | (1,682,779) | (198,794) | (778,538) |
Comprehensive income | ¥ 860,811,637 | ¥ 529,872,608 | ¥ 39,983,249 |
Consolidated statements of chan
Consolidated statements of changes in shareholders' equity - CNY (¥) | Ordinary shares | Additional paid-in capital | Accumulated other comprehensive income/(losses) | Retained earnings | Total |
Balance at Dec. 31, 2015 | ¥ 386,435,474 | ¥ 193,789,295 | ¥ 498,478,400 | ¥ 1,078,703,169 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 235,441,839 | 235,441,839 | |||
Foreign currency translation adjustment | (778,538) | (778,538) | |||
Unrealized losses on available-for-sale investments | (194,680,052) | (194,680,052) | |||
Balance at Dec. 31, 2016 | 386,435,474 | (1,669,295) | 733,920,239 | 1,118,686,418 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 532,672,757 | 532,672,757 | |||
Foreign currency translation adjustment | (198,794) | (198,794) | |||
Unrealized losses on available-for-sale investments | (2,601,355) | (2,601,355) | |||
Share-based compensation | 182,689,766 | 182,689,766 | |||
Balance at Dec. 31, 2017 | 569,125,240 | (4,469,444) | 1,266,592,996 | 1,831,248,792 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 860,908,711 | 860,908,711 | |||
Foreign currency translation adjustment | (1,682,779) | (1,682,779) | |||
Unrealized losses on available-for-sale investments | 1,585,705 | 1,585,705 | |||
Share-based compensation | 39,715,168 | 39,715,168 | |||
Reorganization | ¥ 98,493 | (98,493) | |||
Change in par value of ordinary shares | 720,718 | (720,718) | |||
Issuance of ordinary shares upon initial public offering ("IPO"), net of offering cost | 97,532 | 313,682,251 | 313,779,783 | ||
Balance at Dec. 31, 2018 | ¥ 916,743 | ¥ 921,703,448 | ¥ (4,566,518) | ¥ 2,127,501,707 | ¥ 3,045,555,380 |
Consolidated statements of cash
Consolidated statements of cash flows - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities: | |||
Net income | ¥ 860,908,711 | ¥ 532,672,757 | ¥ 235,441,839 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Provision for credit losses | 433,753,901 | 306,752,951 | 111,362,044 |
Provision for available-for-sale investments | 36,692,695 | ||
Impairment of goodwill | 20,279,026 | ||
Provision for other assets | 1,270,001 | ||
Depreciation and amortization | 13,299,246 | 10,804,855 | 6,595,476 |
Share-based compensation expenses | 39,715,168 | 182,689,766 | |
Share of income from equity method investee | (47,122) | ||
Net loss on disposal of property and equipment | 946,244 | 261,875 | 61,085 |
Net gain on disposal of subsidiaries | 6,060,758 | ||
Foreign exchange (gain)/loss | (1,836,029) | 2,274,438 | (2,717,820) |
Deferred tax benefit | (105,085,476) | (57,888,823) | (33,470,137) |
Net loss on sale of loans | 16,697,259 | ||
Changes in operating assets and liabilities: | |||
Deposits | (27,892,733) | (98,732,767) | (40,932,244) |
Other operating assets | (138,548,636) | (289,327,710) | 43,271,746 |
Other operating liabilities | 240,699,389 | 691,081,484 | 2,077,066 |
Net cash provided by operating activities | 1,332,657,044 | 1,286,649,584 | 379,883,655 |
Cash flows from investing activities: | |||
Loans originated, net of principal collected | 777,832,690 | (9,288,327,415) | (4,985,137,870) |
Proceeds from sales of available-for-sale investments | 390,050,000 | 16,290,109 | 412,780,035 |
Cash received from disposal of cost method investments | 9,350,000 | 500,000 | |
Proceeds from disposal of subsidiaries | 29,658,807 | 57,717,953 | |
Proceeds from disposal of equity method investee | 3,266,969 | ||
Proceeds from disposal of property and equipment and intangible assets | 3,044,763 | 890,219 | 17,215 |
Proceeds from sales of loans | 165,626,448 | ||
Purchase of available-for-sale investments | (710,000,000) | (360,050,000) | (116,618,373) |
Purchases of property, equipment and intangible assets | (14,822,364) | (19,763,521) | (15,223,321) |
Net cash (used in)/provided by investing activities | 641,390,344 | (9,583,892,655) | (4,700,415,345) |
Cash flows from financing activities: | |||
Proceeds from initial public offering, net of offering cost paid of RMB51,967,702 | 313,779,783 | ||
Proceeds from interest-bearing borrowings | 10,931,383,040 | 15,024,145,699 | 5,904,280,461 |
Proceeds from related party | 138,000,000 | ||
Repayment of interest-bearing borrowings | (11,352,964,066) | (5,767,405,436) | (1,613,193,000) |
Repayment through related party | (32,747,681) | ||
Net cash provided by /(used in) financing activities | (2,548,924) | 9,256,740,263 | 4,291,087,461 |
Net (decrease)/increase in cash and cash equivalents | 1,971,498,464 | 959,497,192 | (29,444,229) |
Cash and cash equivalents at the beginning of year | 1,190,360,385 | 233,138,588 | 260,081,796 |
Effect of exchange rate change on cash and cash equivalents | (200,915) | (2,275,395) | 2,501,021 |
Cash and cash equivalents at the end of year | 3,161,657,934 | 1,190,360,385 | 233,138,588 |
Supplemental disclosures of cash flow information: | |||
Income tax paid | 95,837,024 | 45,595,075 | 25,672,356 |
Interest expense paid | ¥ 2,002,298,692 | ¥ 1,298,748,843 | ¥ 416,084,616 |
Consolidated statements of ca_2
Consolidated statements of cash flows (Parentheticals) | 12 Months Ended |
Dec. 31, 2018CNY (¥) | |
Statement of Cash Flows [Abstract] | |
Net of offering cost paid | ¥ 51,967,702 |
DESCRIPTION OF BUSINESS, ORGANI
DESCRIPTION OF BUSINESS, ORGANIZATION, AND BASIS OF PRESENTATION | 12 Months Ended |
Dec. 31, 2018 | |
Description Of Business Organization And Basis Of Presentation [Abstract] | |
DESCRIPTION OF BUSINESS, ORGANIZATION, AND BASIS OF PRESENTATION | 1. DESCRIPTION OF BUSINESS, ORGANIZATION, AND BASIS OF PRESENTATION CNFinance Holdings Limited (“CNFinance”), through its wholly-owned subsidiaries and consolidated variable interest entities (collectively, referred to hereinafter as the “Group”) in the People’s Republic of China (“PRC”), primarily provides micro credit loan services for micro and small-enterprise (“MSE”) owners, and loan lending agency service for banks. The loans are granted through its licensed micro credit subsidiaries in Beijing, Shenzhen and Chongqing directly, or the structure funds funded with the Group as general partners. Through the Group’s network of sales team and branch offices, prospective MSE borrowers are referred to the licensed micro credit subsidiaries or the structure funds. All loans are secured by residential or commercial real estate as of December 31, 2018. The Group’s main funding resources are equity and borrowings from third parties. Reorganization CNFinance is incorporated in the Cayman Islands and was established on January 8, 2014 by the shareholders of Sincere Fame International Limited (“Sincere Fame”). Since its inception on January 8, 2014 to March 27, 2018, CNFinance did not engage in any operating activities. In connection with the reorganization of Sincere Fame (“Reorganization”), on March 27, 2018, the shareholders of Sincere Fame transferred all of their equity interests in Sincere Fame, consisting of 1,230,434,040 ordinary shares of Sincere Fame, in exchange for 1,230,434,040 ordinary shares of CNFinance and CNFinance became the parent company of Sincere Fame. As presented in Note 14, the Company issued one (1) share upon incorporation with par value of HKD0.0001.Upon the shares transfer, the total issued and outstanding shares of the Company is 1,230,434,041. Sincere Fame is incorporated in the British Virgin Islands and before the Reorganization, through its wholly-owned subsidiaries and consolidated variable interest entities in the PRC, primarily provided micro credit loan services for MSE owners, and loan lending agency service for banks. Basis of preparation The consolidated financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles ("U.S. GAAP"). The net assets of Sincere Fame are initially measured and recognized at their historical carrying amounts because the shareholders of CNFinance immediately after the Reorganization have identical ownership interests in Sincere Fame immediately before the Reorganization and the Reorganization is solely for the purpose of establishing the legal structure of CNFinance. Accordingly, the transfer of net assets of Sincere Fame has been accounted for and presented in the accompanying consolidated financial statements in a manner similar to a pooling-of-interests. That is, the consolidated financial statements of CNFinance include the results of the operations and the statement of financial position of Sincere Fame as of the beginning of the earliest period presented. Since CNFinance did not engage in any operating activities, CNFinance’s consolidated financial position as of December 31, 2017 and 2018, and its results of operations for the years then ended represent the continuation of the consolidated financial statements of Sincere Fame, except for its capital structure, which is retroactively adjusted to reflect the legal capital structure of CNFinance. In connection with the preparation of the consolidated financial statements of CNFinance for the years ended December 31, 2016 and 2017, the Group identified certain errors in the presentation of the consolidated statements of cash flow of Sincere Fame for the years ended December 31, 2016 and 2017. In Sincere Fame’s consolidated statements of cash flows, (i) the “Loans originated, net of principal collected” and (ii) “Interest and financing service fee receivable” were reported under the caption titled “Loans principal, interest and financing service fee receivables” in the operating activities, while the item (i) should be reported in the investing activities and item (ii) should be reported under the caption titled “Changes in other operating assets” in the operating activities when the amount is not individually significant; (iii) investment income received from sales of available-for-sale investments were reported under the caption titled “Changes in other operating assets” in operating activities, while the item(iii) should be reported under the caption titled “Proceeds from sales of available-for-sale investments” in the investing activities, and (iv) “Interest paid to related parties” were reported in the financing activities, while the item (iv) should be reported under the caption titled “Changes in other operating liabilities” in the operating activities when the amount is not individually significant. In the preparation of the CNFinance’s consolidated statements of cash flows for the years ended December 31, 2016 and 2017, the cash flows of the above mentioned errors in the Sincere Fame’s consolidated statements of cash flows have been revised accordingly. The following table shows the effect of the adjustments made to the previously issued consolidated statements of cash flows of Sincere Fame for the years ended December 31, 2016 and 2017: RMB in millions For the year ended December 31, 2016 For the year ended December 31, 2017 (as reported) (adjusted) (revised) (as reported) (adjusted) (revised) Cash flows from operating activities: Loans principal, interest and financing service fee receivables (i)(ii) (5,047 ) 5,047 - (9,309 ) 9,309 - Changes in other operating assets (ii)(iii) - (62 ) (62 ) 8 (29 ) (21 ) Changes in other operating liabilities (iv) - - - - (41 ) (41 ) Net cash (used in)/provided by operating activities (4,605 ) 4,985 380 (7,952 ) 9,239 1,287 Cash flows from investing activities: Loans originated, net of principal collected (i) - (4,985 ) (4,985 ) - (9,288 ) (9,288 ) Proceeds from sales of available-for-sale investments, and cash received from disposal of cost method investments (iii) 413 - 413 17 8 25 Net cash provided by/(used in) investing activities 285 (4,985 ) (4,700 ) (304 ) (9,280 ) (9,584 ) Cash flows from financing activities: Payments to related parties (iv) - - - (41 ) 41 - Net cash provided by financing activities 4,291 - 4,291 9,215 41 9,256 Investment in significant subsidiaries for the year ended December 31, 2018 Name of company Place and establishment Registered capital Issued and fully paid up capital Percentage of equity attributable to the Group Principal activities Direct Indirect Sincere Fame International Limited 诚名国际有限公司 British Virgin Islands October 6, 2006 USD1,230,434.04 USD1,230,434.04 100 % - Investment Holding China Financial Services Group Limited 泛华金融服务集团 有限公司 Hong Kong August 28, 2000 HKD100,000,000 HKD100,000,000 - 100 % Investment Holding Fanhua Chuang Li Information Technology (Shenzhen) Co., Ltd. 泛华创利信息技术 ( 深圳 有限公司 the PRC December 21, 1999 HKD400,000,000 HKD400,000,000 - 100 % Investment Holding Shenzhen Fanhua United Investment Group Co., Ltd. 深圳泛华联合投资集团 有限公司 the PRC August 9, 2006 RMB250,000,000 RMB250,000,000 - 100 % Investment Holding Guangzhou Anyu Mortgage Consulting Co., Ltd. 广州安宇按揭咨询 有限公司 the PRC January 23,2003 RMB2,220,000 RMB2,220,000 - 100 % Micro credit and mortgage agency services Zhengzhou Lirui Enterprise Management Advisory Co., Ltd. 郑州利瑞企业管理咨询 有限公司 the PRC December 17, 2009 RMB500,000 RMB500,000 - 100 % Financial consultancy Chongqing Fengjie Financial Advisory Co., Ltd. 重庆丰捷财务咨询 有限公司 the PRC June 13, 2010 RMB500,000 RMB500,000 - 100 % Financial consultancy Guangzhou Chengze Information Technology Co., Ltd. 广州诚泽信息科技 有限公司 the PRC December 11, 2006 RMB3,000,000 RMB3,000,000 - 100 % Software development and maintenance Name of company Place and establishment Registered capital Issued and fully paid up capital Percentage of equity attributable to the Group Principal activities Direct Indirect Chongqing Liangjiang New Area Fanhua Micro-credit Co., Ltd. 重庆市两江新区泛华 小额贷款有限公司 the PRC December 26, 2011 USD30,000,000 USD30,000,000 - 100 % Micro credit and mortgage agency services Shenzhen Fanhua Micro-credit Co., Ltd. 深圳泛华小额贷款 有限公司 the PRC March 15, 2012 RMB300,000,000 RMB300,000,000 - 100 % Micro credit and mortgage agency services Shenzhen Fanhua Fund Management Services Co., Ltd. 深圳泛华基金 管理服务有限公司 the PRC June 8, 2012 RMB5,000,000 RMB5,000,000 - 100 % Company register service Guangzhou Heze Information Technology Co., Ltd. 广州和泽信息科技 有限公司 the PRC September 16, 2010 RMB3,000,000 RMB3,000,000 - 100 % Software development and maintenance Beijing Lianxin Chuanghui Information Technology Co., Ltd. 北京联鑫创辉 信息技术有限公司 the PRC February 2, 2012 HKD10,000,000 HKD10,000,000 - 100 % Software development and maintenance Shenzhen Fanlian Investment Co., Ltd. 深圳泛联投资有限公司 the PRC November 26, 2012 RMB30,000,000 RMB30,000,000 - 100 % Investment Holding Fanhua Financial Leasing (Shenzhen) Co., Ltd. 泛华融资租赁 ( 深圳 有限公司 the PRC September 4, 2012 USD10,000,000 USD10,000,000 - 100 % Financial leasing Shenzhen Fanhua Chengyu Finance Service Co., Ltd. 深圳泛华诚誉金融配套 服务有限公司 the PRC March 15, 2012 RMB10,000,000 RMB10,000,000 - 100 % Labour outsourcing services Hangzhou Shenzhen Fanlian Investment Co., Ltd. 杭州深泛联投资管理 有限公司 the PRC December 14, 2015 RMB1,000,000 - - 100 % Asset Management Beijing Fanhua Qilin Capital Management Co., Ltd. 北京泛华麒麟资本管理 有限公司 the PRC December 26, 2016 RMB100,000,000 RMB10,000,000 - 96 % Asset Management Name of company Place and establishment Registered capital Issued and fully paid up capital Percentage of equity attributable to the Group Principal activities Direct Indirect Shijiazhuang Fanhua Financial Advisory Co., Ltd. 石家庄泛华财务咨询 有限公司 the PRC July 27, 2017 RMB2,000,000 - - 100 % Financial Consultancy Taizhou Fanhua Financial Advisory Co., Ltd. 泰州泛华财务咨询服务 有限公司 the PRC September 28, 2017 RMB500,000 - - 100 % Financial Consultancy Xuzhou Shenfanlian Enterprise Management Co., Ltd. 徐州深泛联企业管理 有限公司 the PRC December 7, 2017 RMB10,000,000 - - 100 % Enterprise Management Zhenjiang Fanhua Business Service Advisory Co., Ltd. 镇江泛华商务服务咨询 有限公司 the PRC October 16, 2017 RMB500,000 - - 100 % Business Advisory Nantong Shenfanlian Enterprise Management Co., Ltd. 南通深泛联企业管理 有限公司 the PRC September 8, 2017 RMB5,000,000 - - 100 % Enterprise Management Jiaxing Fanhua Enterprise Management Advisory Co., Ltd. 嘉兴泛华企业管理咨询 有限公司 the PRC February 7, 2018 RMB500,000 - - 100 % Enterprise Management Baoding Fanjie Financial Advisory Co., Ltd. 保定泛杰财务咨询 有限公司 the PRC February 9, 2018 RMB500,000 - - 100 % Financial Consultancy Shenzhen Fancheng Business Operation Management Partnership (Limited Partnership) 深圳泛诚商业运营管理合伙 企业 (有限合伙) the PRC June 22, 2018 RMB36,210,000 RMB36,210,000 - 100 % Enterprise Management Fanxiaoxuan Cultural Media (Guangzhou) Co., Ltd. 泛小宣文化传媒 (广州) 有限公司 the PRC July 16, 2018 RMB1,000,000 - - 100 % Enterprise Management Variable interest entities (“VIEs”) An entity is a variable interest entity (VIE) if it meets the criteria outlined in Accounting Standards Codification (ASC) Topic 810, Consolidation, which are (i) the entity has equity that is insufficient to permit the entity to finance its activities without additional subordinated financial support from other parties; or (ii) the entity has equity investors that cannot make significant decisions about the entity’s operations or that do not absorb their proportionate share of the entity’s expected losses or expected returns. The Group consolidates a VIE when it has both the power to direct the activities that most significantly impact the VIE’s economic performance and a right to receive benefits or the obligation to absorb losses of the entity that could be potentially significant to the VIE (that is, the Group is the primary beneficiary). In addition to variable interests held in consolidated VIEs, the Group has variable interests in other VIEs that are not consolidated because the Group is not the primary beneficiary. However, these VIEs and all other unconsolidated VIEs are monitored by the Group to assess whether any events have occurred to cause its primary beneficiary status to change. All other entities not deemed to be VIEs with which the Group has involvement are evaluated for consolidation under other subtopics of ASC 810. In the normal course of business, the Group engages in a variety of activities with VIEs. The Group determines whether it is the primary beneficiary of a VIE at the time it becomes involved with the variable interest entity and reconsiders that conclusion continually. In evaluating whether the Group is the primary beneficiary, the Group evaluates its economic interests in the entity. If the Group is determined to be the primary beneficiary of a VIE, it must account for the VIE as a consolidated subsidiary. If the Group is determined not to be the primary beneficiary of a VIE, such VIE is not consolidated. The Group has segregated its involvement with VIEs between those VIEs which are consolidated and those VIEs which are not consolidated. Consolidated VIEs Structure funds The Group grants loans to customers through structure funds set up by trust companies. The assets of the structure funds can only be used to settle obligations of consolidated VIEs. The cash of structure funds represents that funds established by the institutional trust companies through segregated bank accounts, including structure funds that are partially funded by the Group’s own capital. The cash and cash equivalents of structure funds amounted to RMB2,457,242,507 and RMB911,581,943 as of December 31,2018 and 2017 respectively can only be used to grant loans. The Group is general partner of the funds, promising the expected returns for limited partners, and providing credit enhancement on the loans to customers under the funds. The Group is also the manager of the funds, making decisions in the loan origination process. The Group is the primary beneficiary of the funds as it has the power to direct the activities that most significantly impact the economic performance of the funds and it has obligation to absorb losses of the funds that could potentially be significant to the funds or the right to receive benefits from the funds that could potentially be significant to the funds. The Group consolidates the structure funds as it is the primary beneficiary of the funds as of December 31, 2018. Starting in March 2018, the Group has been working with trust companies to implement new funding arrangements. Under credit strengthening arrangements, the Group no longer provides credit enhancement on the loans to customers under the structure funds except for current outstanding loans under the existing trust products and loans to be granted thereunder. However, the Group still promises expected returns for limited partners under credit strengthening arrangements, which exposes the Group to obligation to absorb losses of the funds that could potentially be significant to the funds. The Group is still the manager of the structure funds, which gives the Group the power to direct the activities that most significantly impact the economic performance of the funds. The structure funds are not taxpayers according to PRC tax law. The Group consolidates the structure funds as it is the primary beneficiary of the funds as of December 31, 2018. Shenzhen Taotaojin Internet Financial Services Company Limited Shenzhen Taotaojin Internet Financial Services Company Limited (“Taotaojin”) was established in Shenzhen in 2014 with registered capital of RMB50 million. Taotaojin operates a peer-to-peer (P2P) online lending platform in China. The Group invested RMB50 million share capital into Taotaojin through the two shareholders who hold the equity interests in Taotaojin on behalf of the Group. There is no recourse to the Group. Pursuant to the agreements between the Group and the two shareholders, the two shareholders are not entitled to direct the activities that significantly impact Taotaojin’s assets, operation and obligations. And the two shareholders authorized representatives designated by the Group to exercise all shareholders rights on the board. The shareholders of the Taotaojin also have irrevocably granted the Group an exclusive option to purchase, or have its designated person or persons to purchase, at its discretion, to the extent permitted under PRC law, all or part of such shareholders’ equity interests in Taotaojin. Therefore, the Group has the power to direct the activities of Taotaojin that most significantly impact the economic performance based on its rights authorized by the shareholders. In addition, the Group has obligation to absorb losses of Taotaojin that could potentially be significant to Taotaojin as a result of the capital contributed through the loans to shareholders and other financial supports through intercompany transactions. The Group consolidates Taotaojin as it is a primary beneficiary of Taotaojin, the Group sold Taotaojin and its subsidiaries in September, 2017, to Shenzhen Dongfang Baoying Investments Co., Ltd., at consideration of RMB215,000,000. The Group recognized a pre-tax gain of RMB2,336,201 related to the sale. The table sets forth the investments in the consolidated VIEs by the Group as of December 31, 2018. Name of structure funds Place and establishment Principal activities Jinghua Structure Fund 5 菁华5号信托计划 the PRC December 19, 2014 Micro credit Jinghua Structure Fund 6 菁华6号信托计划 the PRC September 9, 2014 Micro credit Bohai Trust Shenfanlian Micro Finance Structure Fund 渤海信托深泛联小微金融集合资金信托计划 the PRC September 14, 2016 Micro credit Bohai Huihe SME Structure Fund 渤海汇和中小微企业经营贷集合资金信托计划 the PRC September 29, 2017 Micro credit Zhongyuan Wealth Anhui Structure Fund 1 中原财富-安惠1期 the PRC January 20, 2017 Micro credit Zhongyuan Wealth Anhui Structure Fund 2 中原财富-安惠2期 the PRC August 18, 2017 Micro credit Beijing Fanhua Micro-credit Company Limited 北京泛华小额贷款有限公司 the PRC August 10, 2012 Micro credit and mortgage agency services No.27 Jinghua Structure Fund 菁华27号信托计划 the PRC May, 18,2018 Micro credit No.29 Jinghua Structure Fund 菁华29号信托计划 the PRC May, 16,2018 Micro credit Yuecai Loan Structure Arrangement 粤财网贷合作计划 the PRC July 6, 2018 Micro credit Zhonghai Lanhai Structure Fund 中海信托蓝海1号集合资金信托计划 the PRC July 18, 2018 Micro credit Bairui Hengyi No.613 Structure Fund 百瑞恒益613号集合资金信托计划 the PRC July 25, 2018 Micro credit Bohai Trust No.1 Huiying Structure Fund 渤海惠盈1号集合资金信托计划 the PRC September 10, 2018 Micro credit Bohai Trust No.2 Shenzhen Fanhua United Structure Fund 渤海信托-深泛联2号集合资金信托计划 the PRC November 28, 2018 Micro credit Everbright No.1 Business Acceleration Structure Fund 光大助业1号集合资金信托计划 the PRC November 29, 2018 Micro credit The table sets forth the assets and liabilities of the consolidated VIEs included in the Group’s consolidated balance sheets: December 31, 2017 2018 RMB RMB Cash and cash equivalents 1,005,069,665 2,556,453,812 Loans principal, interest and financing service fee receivables 15,741,026,758 14,693,474,990 Available-for-sale investments - 270,497,995 Deferred tax assets 59,892 216,380 Other assets 134,288,627 192,135,492 Total assets 16,880,444,942 17,712,778,669 Interest-bearing borrowings 11,768,149,067 12,552,191,338 Income tax payable 923,786 956,881 Other liabilities 528,843,275 772,026,076 Total liabilities 12,297,916,128 13,325,174,295 The table sets forth the results of operations of the VIEs included in the Group’s consolidated statements of comprehensive income: 2016 2017 2018 RMB RMB RMB Revenues 1,230,596,060 3,247,097,840 4,030,796,059 Net income 316,604,468 1,074,500,910 910,293,862 The table sets forth the cash flows of the VIEs included in the Group’s consolidated statements of cash flows: 2016 2017 2018 RMB RMB RMB Net cash provided by operating activities 843,392,296 3,858,370,455 340,962,220 Net cash (used in)/provided by investing activities (5,109,269,063 ) (8,905,181,155 ) 301,170,602 Net cash provided by financing activities 4,249,962,461 5,916,858,297 909,251,326 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Principles of consolidation The accompanying consolidated financial statements include the financial statements of the Group, its subsidiaries and consolidated VIEs. All intercompany transactions and balances have been eliminated in consolidation. The Group accounts for investments over which it has significant influence but not a controlling financial interest using the equity method of accounting. (b) Currency translation for financial statements presentation The Group uses Renminbi (“RMB”) as its reporting currency. The United States Dollar (“USD”) is the functional currency of the Company incorporated in Cayman and the Group’s subsidiary Sincere Fame incorporated in British Virgin Islands, and the Hong Kong Dollar(“HKD”) is the functional currency of the Group’s subsidiary China Financial Services Group Limited incorporated in Hong Kong and the RMB is the functional currency of the Group’s PRC subsidiaries. The financial statements of the Group are translated from the functional currency to the reporting currency, RMB. Assets and liabilities of the subsidiaries are translated into RMB using the exchange rate in effect at each balance sheet date. Income and expenses items are generally translated at the average exchange rates prevailing during the fiscal year. Foreign currency translation adjustments arising from these are accumulated as a separate component of shareholders’ deficit on the consolidated financial statements. The resulting exchange differences are recorded in the consolidated statements of comprehensive income/ (losses). (c) Use of estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include, allowance for loans principal, interest and financing service fee receivables, the valuation allowance for deferred tax assets, the unrecognized tax benefits and indefinite reinvestment assertion, the fair value of available-for-sale investments and the fair value of share-based compensation. (d) Revenue recognition Interest and financing service fee on loans which are amortized over the contractual life of the related loans are recognized in consolidated statements of comprehensive income in accordance with ASC 310 using the effective interest method. Mortgage agency service revenue, asset management revenue and revenue from rendering of services are recognized in accordance with ASC 606 when following conditions are met: identify the contract(s) with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract and recognize revenue when (or as) the entity satisfies a performance obligation. The criteria of revenue recognition as they relate to each of the following major revenue generating activities are described below: (i) Interest and financing service fee on loans Interest and financing service fee on loans, which include financing service fee on loans, are collected from borrowers for loans and related services. Interest and financing service fee on loans includes the amortization of any discount or premium or differences between the initial carrying amount of an interest-bearing asset and its amount at maturity calculated using the effective interest basis. The effective interest method is a method of calculating the amortized cost of a financial asset and of allocating the interest and financing service fee on loans over the years. The effective interest rate is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument. When calculating the effective interest rate, the Group estimates cash flows considering all contractual terms of the financial instrument but does not consider future credit losses. Interest on the impaired assets is recognized using the rate of interest used to discount future cash flows. (ii) Mortgage agency service revenue and asset management revenue The Group earns mortgage agency service revenue from providing mortgage agency services to borrowers applying for a bank loan. This kind of revenue is recognized at the time when loan is granted as that is the point of time the Group fulfils the customer’s request, and is then recognized on an accrual basis in accordance with the terms of the relevant agreements. The Group receives asset management revenue from providing asset management services for investors. The asset management revenue is calculated and accrued on a daily basis based on the daily net asset values of the asset management products under management. (iii) Realized gains/ (losses) on sales of investments Realized gains/ (losses) consist of realized gains and losses from the sale of available-for-sale investments, presented on a net basis. (iv) Rendering of services When the outcome of a transaction involving the rendering of services can be estimated reliably, revenue from the rendering of services is recognized by reference to the stage of completion of the transaction based on the services performed to date as a percentage of the total services to be performed. When the outcome of a transaction involving the rendering of services cannot be estimated reliably, revenue is recognized only to the extent of the costs incurred that it is probably recoverable. (e) Loans Loans are reported at their outstanding principal balances net of any unearned income and unamortized deferred fees and costs. Loan origination fees and certain direct origination costs are generally deferred and recognized as adjustments to income over the lives of the related loans. The Group facilitates credit to borrowers through structure funds which are considered as consolidated VIEs and the Group evaluated VIEs for consolidation in accordance with ASC 810 in the Consolidated VIEs Section of Note 1. Providing credit enhancement and top-up arrangement for the loans to customers under the funds is one of the key factors to determine that the Group should consolidate the structure funds as it is the primary beneficiary of the funds. As a result, the loan principal remains on the Group’s consolidated balance sheets, whilst the funds received from senior tranches holders are recorded as Other Borrowings in the Group’s consolidated balance sheets as disclosed in Note 12(b)(i). Non-accrual policies Loans principal, interest and financing service fee receivables are placed on non-accrual status when payments are 90 days contractually past due. When a loan principal, interest and financing service fee receivable is placed on non-accrual status, financing service fees accrual ceases. If the loan is non-accrual, the cost recovery method is used and cash collected is applied to first reduce the carrying value of the loan. Otherwise, interest income may be recognized to the extent cash is received. Loans principal, interest and financing service fee receivables may be returned to accrual status when all of the borrower’s delinquent balances of loans principal, interest and financing service fee have been settled and the borrower continue to perform in accordance with the loan terms for a period of at least six months. Charge-off policies Loans principal, interest and financing service fee receivables are charged off when the Group has determined the remaining balance is uncollectable after exhausting all collection efforts. In order to comply with ASC 310, the Group considers loans principal, interest and financing service fee receivables meeting any of the following conditions as uncollectable and charged-off: (i) death of the borrower; (ii) identification of fraud, and the fraud is officially reported to and filed with relevant law enforcement departments or (iii) the Group concludes that it has exhausted its collection efforts. Allowance for credit losses Allowance for credit losses represents management’s best estimate of probable losses inherent in the portfolio. The allowance for credit losses includes an asset-specific component and a statistically based component. The asset-specific component is calculated under ASC 310-10-35, on an individual basis for the loans whose payments are contractually past due more than 90 days or which are considered impaired. An asset-specific allowance is established when the discounted cash flows, collateral value (less disposal costs) or observable market price of the impaired loan are lower than its carrying value. This allowance considers the borrower’s overall financial condition, resources, and payment record, the prospects for support from any financially responsible guarantors and, if appropriate, the realizable value of any collateral. The allowance for the remainder of the loan portfolio is determined under ASC 450 using a roll rate-based model. The roll rate-based model stratifies the loan principal, interest and financing service fee receivables by delinquency stages which are divided by days overdue and projected forward in next stage using probability of default. In each stage of the simulation, losses on the loan principal, interest and financing service fee receivables types are captured, and the ending delinquency stratification serves as the beginning point of the next iteration. This process is repeated on a monthly rolling basis. The loss rate calculated for each delinquency stage using loss given default, then applied to the respective loan principal, interest and financing service fees balance. The Group adjusts the allowance that is determined by the roll rate-based model for various Chinese macroeconomic factors (i.e. gross-domestic product rates, interest rates and consumer price indexes). Each of these macroeconomic factors are equally weighted, and a score is applied to each factor based on year-on-year increases and decreases in that respective factor. Loans held-for-sale Held-for-sale loans are measured at the lower of cost or fair value, with valuation changes recorded in noninterest revenue. The valuation is performed on an individual loan basis. Loan origination fees or costs and purchase price discounts or premiums are deferred in a contra loan account until the related loan is sold. The deferred fees or costs and discounts or premiums are an adjustment to the basis of the loan and therefore are included in the periodic determination of the lower of cost or fair value adjustments and/or the gain or loss recognized at the time of sale. (f) Cash and cash equivalents Cash and cash equivalents primarily consist of cash, deposits which are highly liquid and all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. The Company considers highly liquid investments that are readily convertible to known amounts of cash. (g) Available-for-sale (“AFS”) investments The Group classifies wealth management products and asset management products as available-for-sale ("AFS") investments. AFS investments are recorded at fair value. Unrealized holding gains and losses, net of the related tax effect, on AFS investments are excluded from earnings and are reported as a separate component of accumulated other comprehensive income until realized. Realized gains and losses from the sale of AFS investments are determined on a specific identification basis and are recorded as realized gains/ (losses) on sales of investments. Interest and investment income are recognized when earned. (h) Property and equipment Property and equipment are stated at cost. Depreciation on equipment is calculated on the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of the economic useful life of the improvement or the term of the lease. The estimated useful life of office and other equipment range from 1 to 5 years, the estimated useful life of leasehold improvements or the term of the lease range from 1 to 6 years, while the estimated useful lives of motor vehicles range from 3 to 8 years. (i) Goodwill Goodwill is an asset representing the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. On August 31, 2006, the Group acquired a 55% stake in Guangzhou Anyu Mortgage Consulting Co., Limited (“Guangzhou Anyu”). On the acquisition date, the fair value of Guangzhou Anyu’s identifiable net assets was RMB42.36 million, 55% of which the Group accounted for was RMB23.3 million. An amount of RMB20.28 million was recognized as goodwill, representing the excess of the consideration transferred over the Group’s proportionate share of the fair value of identifiable net assets. On May 25, 2009, the Group acquired the remaining 45% shares in Guangzhou Anyu for RMB27.47 million. Guangzhou Anyu was incorporated in the PRC in 2003 and was primarily engaged in the business of providing mortgage agency services and loans at the time of acquisition. Impairment tests for cash-generating units containing goodwill Goodwill is not amortized on a recurring basis, but rather are subject to periodic impairment testing. The Group reviews goodwill annually for impairment or when circumstances indicate that the carrying value may exceed the fair value. The Group compares the carrying value of goodwill to its estimated fair value, which is based on the expected present value of future cash flows, comparable public companies and acquisitions or a combination of both. The quantitative analysis requires a comparison of the fair value to carrying amount. If the fair value of the reporting unit is in excess of the carrying value, the related goodwill is considered not to be impaired and no further analysis is necessary. If the carrying value of the reporting unit is higher than the fair value, impairment is measured as the excess of the carrying amount over the fair value. The recoverable amount of the cash-generating-units (“CGU”) is calculated using Dividend Discount Model (DDM). The projected cash flow for the next year is based on financial budgets approved by management. Cash flows beyond next year are estimated using a weighted average growth rate of 3%, which is consistent with the forecasts in industry research reports. The growth rate does not exceed the long-term average growth rates for the business in which the CGU operates. The projected cash flows are then discounted using a discount rate of 21% as of December 31, 2016. The discount rate is pre-tax and reflects specific risks relating to the relevant segments. In 2016, the key management of Guangzhou Anyu has left the company. Guangzhou Anyu's business model has changed from providing loans to referring micro credit business to other entities of the Group, resulting in an expected reduction in the operating profits and cash flows in the future. Therefore, the Group recognized a goodwill impairment loss of RMB20,279,026. The goodwill was fully impaired as of December 31, 2016. (j) Intangible assets Indefinite-lived intangible assets are assets that are not amortized because there is no foreseeable limit to cash flows generated from them. Intangible assets with finite useful lives are amortized on a straight line basis over their estimated useful lives. The Group categorizes trademarks as indefinite-lived intangible assets, whose carrying value is RMB2.97 million. If it is more likely than not that the asset is impaired, the Group records the amount that the carrying value exceeds the fair value as an impairment expense. The Group performed its annual impairment review of indefinite-lived intangible assets on December 1, 2018 and 2017 and determined that it is more likely than not that the carrying values were less than the fair values. Intangible assets with finite useful lives represent software and cooperation agreements, the estimated useful lives of which are 1 to 5 years and 5 years, respectively. As of December 31, 2018 and 2017, accumulated amortization were RMB12,518,252 and RMB12,204,977, respectively. (k) Income tax Income tax is accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and for their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Group recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50 percent likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Group classifies interest and penalties recognized on the liability for unrecognized tax benefits as income tax expense. (l) Employee benefit plans Pursuant to relevant PRC regulations, the Group is required to make contributions to various employee benefit plans organized by municipal and provincial PRC governments. The contributions are made for each PRC employee at statutory rates as determined by local social security bureau. Contributions to the employee benefit plans are charged to the consolidated statements of income. The Group has no obligations for payment of pension benefits associated with the plans beyond the amount it is required to contribute. (m) Long-lived assets Long-lived assets, such as property and equipment, and purchased intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, the Group first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. (n) Share-based compensation The Group measures the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award and recognizes the cost over the period the employee is required to provide service in exchange for the award, which generally is the vesting period. The Group recognizes compensation cost for an award with only service conditions that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award, net of estimated forfeitures, provided that the cumulative amount of compensation cost recognized at any date at least equals the portion of the grant-date value of such award that is vested at that date. Forfeiture rates are estimated based on historical and future expectations of employee turnover rates. (o) Operating leases Leases where substantially all the rewards and risks of ownership of assets remain with the lessor are accounted for as operating leases. Rentals applicable to such operating leases are recognized on a straight-line basis over the lease term. Certain of the operating lease agreements contain rent holidays. Rent holidays are considered in determining the straight-line rent expense to be recorded over the lease term. (p) Repurchase agreements Financial assets sold under agreements to repurchase do not constitute a sale of the underlying financial assets for accounting purposes and are treated as collateralized financing transactions. Financial assets sold under agreements to repurchase are recorded at the amount of cash received plus accrued interest. Interest paid on agreements to repurchase is recorded in interest expense at the contractually specified rate. (q) Commitments and contingencies Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. (r) Fair value measurements The Group uses valuation approaches that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Group determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels in accordance with ASU 2011-04 (see Note 7 to the consolidated financial statements): • Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date. • Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. • Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date. The level in the fair value hierarchy within which a fair value measurement in its entirety falls is based on the lowest level input that is significant to the fair value measurement in its entirety. In situations where there is little, if any, market activity for the asset or liability at the measurement date, the fair value measurement reflects management’s own judgments about the assumptions that market participants would use in pricing the asset or liability. Those judgments are developed by management based on the best information available in the circumstances. (s) Earnings per share Basic earnings per share is computed by dividing net income attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per share is calculated by dividing net income attributable to ordinary shareholders by the weighted average number of ordinary and dilutive ordinary equivalent shares outstanding during the period. Ordinary equivalent shares are not included in the denominator of the diluted earnings per share calculation when inclusion of such shares would be anti-dilutive. For purposes of calculating basic earnings per share for the years ended December 31, 2017 and 2018, the weighted average number of shares used in the calculation has been retroactively adjusted to reflect the incorporation of the Company and the Reorganization (see Note 1), as if these events had occurred at the beginning of the earliest period presented and these shares had been outstanding for all periods. (t) Segment reporting The Group uses the management approach in determining its operating segments. The management approach considers the internal reporting used by the Group’s chief operating decision maker for making decisions about the allocation of resources to and the assessment of the performance of the segments of the Group, therefore management has determined that the Group has one operating segment. All of the Group’s operations and customers are located in the PRC. Consequently, no geographic information is presented. (u) Recently adopted accounting standards ASU 2014-09, Revenue from Contracts with Customers (Topic 606). The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity is expected to be entitled for those goods or services. ASU 2014-09 defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under existing U.S. GAAP, including: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when (or as) the entity satisfies a performance obligation. Companies are permitted to adopt the standard using a retrospective transition method (i.e., restate all prior periods presented) or a cumulative effect method (i.e., recognize the cumulative effect of initially applying the guidance at the date of initial application with no restatement of prior periods). The Group adopted ASU 2014-09 and applied the cumulative effect method for its initial application since the first quarter of 2018 but there was no impact to retained earnings as a result of the adoption of the new standard. Because there is no change to the timing and pattern of revenue recognition, there are no material changes to the Group’s processes and internal controls. There are two reasons ASU 2014-09 did not have an impact to the Group. Firstly, over 99% of revenues in 2018 and 2017 are interest income earned on loans or deposits with banks, all of which are unaffected as they are outside the scope of ASU 2014-09. Secondly, the Group's non-interest income revenue stream such as mortgage agency service revenue are largely based on transactional activity, is within the scope of ASU 2014-09. However, only one percent of revenues in 2018 and 2017 are non-interest income revenue and the Group does not typically enter into long term mortgage agency service contracts with customers. Therefore, the Group does not experience significant contract balances. All of the Group’s revenue from contracts with customers in the scope of ASC 606 is recognized within Non-Interest Income. ASU 2014-09 requires disclosure of sufficient information to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. A description of the Group’s revenue streams accounted for under ASU 2014-09 as well as an explanation of why they are not impacted are as follows: Mortgage agency service revenue The Group earns fees from providing mortgage agency services to borrowers applying for loan from banks. Mortgage agency service fee is often received immediately or shortly after establishing contracts with customers. These kind of revenue are recognized at the time the transaction is executed as that is the point in time the Group fulfills the customer’s request. ASU 2016-01 Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 changes the accounting for certain equity securities to record at fair value with unrealized gains or losses reflected in earnings, as well as improve the disclosures of equity securities and the fair value of financial instruments. ASU 2016-01 also requires that for purposes of disclosing the fair value of financial instruments recorded at amortized cost, including loans and long-term debt, the valuation methodology is based on an exit price notion. The Group adopted ASU 2016-01 in January 1, 2018 with no material impact on our consolidated financial statements and related disclosures. No transition adjustment was recorded for investments changed to the measurement alternative, which was applied prospectively. The Group’s investments in nonmarketable equity securities, which are private equity securities, previously accounted for under the cost method of accounting are now accounted for using the measurement alternative. The measurement alternative is similar to the cost method of accounting, except the carrying value is adjusted through earnings for impairment, if any, and changes in observable and orderly transactions in the same or similar investment. In connection with our adoption of ASU 2016-01, the caption which the nonmarketable equity securities are accounted for is modified from other assets – cost method investments to other assets – equity securities in Note 11(i). In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. Restricted cash represents that funds in the consolidated structure funds of the Group established by the institutional trust partners through segregated bank accounts, including structure funds that are partially funded by our own capital. Such restricted cash is not available to fund the general liquidity needs of the Group. This ASU is effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Group elected to adopt ASU 2016-18 as of January 1, 2018. (v) Recently issued accounting standards In February 2016, the FASB established Topic 842, Leases, by issuing Accounting Standards Update (ASU) No. 2016-02, which requires lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. Topic 842 was subsequently amended by ASU No. 2018-01, Land Easement Practical Expedient for Transition to Topic 842; ASU No. 2018-10, Codification Improvements to Topic 842, Leases; and ASU No. 2018-11, Targeted Improvements. The new standard establishes a right-of-use model (ROU) that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. The new standard is effective for us on January 1, 2019, with early adoption permitted. The Group expect to adopt the new standard on its effective date. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. If an entity chooses the second option, the transition requirements for existing leases also apply to leases entered into between the date of initial application and the effective date. The entity must also recast its comparative period financial statements and provide the disclosures required by the new standard for the comparative periods. The Group expect to adopt the new standard on January 1, 2019 and use the effective date as our date of initial application. Consequently, financial information will not be new standard will not be provided for dates and periods before January 1, 2019. The new standard provides a number of optional practical expedients in transition. The Group expect to elect the ‘package of practical expedients’, which permits us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. The Group do not expect to elect the use-of-hindsight or the practical expedient pertaining to land easements; the latter not being applicable to us. The Group expect that this standard will have a material effect on our financial statements. While the Group continue to assess all of the effects of adoption, the Group currently believe the most significant effects relate to the recognition of new ROU assets and lease liabilities on our balance sheet for the Group’s office operating leases. The Group do not expect a significant change in our leasing activities between now and adoption. On adoption, the Group currently expect |
DISPOSAL OF SUBSIDIARIES
DISPOSAL OF SUBSIDIARIES | 12 Months Ended |
Dec. 31, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISPOSAL OF SUBSIDIARIES | 3. DISPOSAL OF SUBSIDIARIES Disposals for the year ended December 31, 2017 In 2017, the Group sold its asset management business, its peer-to-peer platform and its labour outsourcing business, all of which were non-core to the Group’s business, to third parties. The Group received a total consideration of RMB284,550,000 and recognized a total gain of RMB6,060,758 related to the sale. Since the disposal of the subsidiaries did not represent a strategic shift that would have a major effect on the Group’s operations and financial results, it was not reflected as discontinued operations. Effect of disposal on the financial position of the Group Aggregated RMB Cash and cash equivalents 10,532,048 Loans principal, interest and financing service fee receivables 28,221,115 Available-for-sale investments 33,616,143 Interest in equity method investee 20,450,000 Property and equipment 3,653,157 Intangible assets and goodwill 23,333 Deferred tax assets 12,779,966 Other assets 320,606,280 Accrued employee benefits (2,294,431 ) Income tax payable (14,785,506 ) Other liabilities (134,312,863 ) Net assets and liabilities 278,489,242 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | 4. FAIR VALUE MEASUREMENTS Fair Value Hierarchy FASB ASC 820 defines fair value, establishes a framework for measuring fair value, and establishes a hierarchy of fair value inputs. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market. Valuation techniques that are consistent with the market, income or cost approach, as specified by FASB ASC 820, are used to measure fair value. Fair Value Measurements A description of the valuation techniques applied to the Group's major categories of assets and liabilities measured at fair value on a recurring basis as follows. The Group determines fair value primarily based on pricing sources with reasonable levels of price transparency. Where quoted prices are available in an active market, the Group classifies the securities within Level 1 of the valuation hierarchy. If quoted market prices are not available, fair values are primarily determined using pricing models using observable trade data, market data, quoted prices of securities with similar characteristics or discounted cash flows. Such instruments would generally be classified within Level 2 of the valuation hierarchy. As of December 31, 2018, available-for-sale investments are valued based on prices per units quoted by issuers. They are categorized in level 2 of the fair value hierarchy. The following table presents the Group's fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of December 31, 2017 and 2018. December 31, 2018 Fair value Level 1 Level 2 Level 3 RMB RMB RMB RMB Wealth management products 682,252,159 - 682,252,159 - December 31, 2017 Fair value Level 1 Level 2 Level 3 RMB RMB RMB RMB Wealth management products 360,187,885 - 360,187,885 - During the years ended December 31, 2017 and 2018, there were no transfers between instruments in Level 1 and Level 2. The Group do not have level 3 instruments as of December 31, 2017 and 2018. |
CASH AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS | 12 Months Ended |
Dec. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
CASH AND CASH EQUIVALENTS | 5. CASH AND CASH EQUIVALENTS Cash and cash equivalents represents cash on hand and bank deposits. To limit exposure to credit risk relating to bank deposits, the Group primarily places bank deposits with large financial institutions in the PRC with acceptable credit rating. As of December 31, 2017 and 2018, the Group had cash balances at one and two PRC individual financial institutions, respectively, that held cash balances in excess of 10% of the Group's total cash balances. These bank deposits collectively accounted for approximately 54% and 85% of the Group's total cash balances as of December 31, 2017 and 2018, respectively. The nominal holders of certain bank accounts of the Group are employees of the Group. The Group has entered agreements with these employees which stipulate that the funds held in these bank accounts are owned and managed by the Group. Cash balances of such accounts collectively accounted for 1.14% and 0.63% of the Group’s total cash balances as of December 31, 2017 and 2018, respectively. |
LOANS PRINCIPAL, INTEREST AND F
LOANS PRINCIPAL, INTEREST AND FINANCING SERVICE FEE RECEIVABLES | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
LOANS PRINCIPAL, INTEREST AND FINANCING SERVICE FEE RECEIVABLES | 6. LOANS PRINCIPAL, INTEREST AND FINANCING SERVICE FEE RECEIVABLES December 31, Note 2017 2018 RMB RMB Loans principal, interest and financing service fee receivables 16,701,504,043 15,861,324,470 Less: allowance for credit losses (a) - Individually assessed (98,736,342 ) (157,157,377 ) - Collectively assessed (341,599,744 ) (705,881,227 ) Subtotal (440,336,086 ) (863,038,604 ) Net loans principal, interest and financing service fee receivables 16,261,167,957 14,998,285,866 (a) Allowance for credit losses The table below presents the components of allowances for loans principal, interest and financing service fee receivables by impairment methodology with the recorded investment as of December 31, 2018 and 2017. 2018 Allowance for Allowance for Total RMB RMB RMB As of January 1 341,599,744 98,736,342 440,336,086 Provision for credit losses 364,289,770 69,464,131 433,753,901 Charge-offs (8,287 ) (11,043,096 ) (11,051,383 ) Recoveries - - - As of December 31 705,881,227 157,157,377 863,038,604 Net loans principal, interest and financing service fee receivables 14,760,930,158 237,355,708 14,998,285,866 Recorded investment 15,466,811,385 394,513,085 15,861,324,470 2017 Allowance for loans which are collectively assessed Allowance for loans which are individually assessed Total RMB RMB RMB As of January 1 89,562,675 55,180,661 144,743,336 Provision for credit losses 252,549,185 54,203,766 306,752,951 Charge-offs (512,116 ) (10,648,085 ) (11,160,201 ) Recoveries - - - As of December 31 341,599,744 98,736,342 440,336,086 Net loans principal, interest and financing service fee receivables 16,065,757,967 195,409,990 16,261,167,957 Recorded investment 16,407,357,711 294,146,332 16,701,504,043 The Group uses discounted cash flow method to estimate expected credit losses for loans individually assessed. Under the discounted cash flow method, the allowance for credit losses is estimated as the difference between amortized cost and the present value of cash flows expected to be collected. For each loan, if the present value of cash flows expected to be collected is lower than the amortized cost, allowance for credit losses is charged. Conversely, allowance for credit losses would be reversed. To collectively assess the expected credit losses for the remaining loans portfolios by each entity within the Group, the Group assesses allowance for credit losses using roll rate-based model, see Note 2(e) Loans. For each entity within the Group, if the allowance for credit losses determined by roll rate-based model is higher than the allowance that has been accrued, allowance for credit losses would be charged. Conversely, allowance for credit losses would be reversed. The Group charges off loans principal, interest and financing service fee receivables if the remaining balance is considered uncollectable after exhausting all collection efforts. Recovery of loans principal, interest and financing service fee receivables previously charged off would be recorded when received. For the description of the Group's related accounting policies of allowance for credit losses, see Note 2(e) Loans. (b) Loan delinquency and non-accrual details The following tables present the aging of past-due loan principal and financing service fee receivables as of December 31, 2018. Total current 1–30 days 31–90 days 91–180 days >180 days Total loans Total non-accrual 90 days past due RMB RMB RMB RMB RMB RMB RMB RMB Loans principal, interest and financing service fee receivables 12,929,493,099 1,031,203,259 1,484,689,974 159,343,805 256,594,333 15,861,324,470 415,938,138 - The following tables present the aging of past-due loan principal and financing service fee receivables as of December 31, 2017. Total current 1–30 days past due 31–90 days past due 91–180 days past due >180 days past due Total loans Total non-accrual 90 days past due and accruing RMB RMB RMB RMB RMB RMB RMB RMB Loans principal, interest and financing service fee receivables 15,477,867,781 723,143,029 206,346,901 136,276,334 157,869,998 16,701,504,043 294,146,332 - Loans principal, interest and financing service fee receivables are placed on non-accrual status when payments are 90 days contractually past. Any interest accrued on non-accrual loans is reversed at 90 days and charged against current earnings, and interest is thereafter included in earnings only to the extent actually received in cash. When there is doubt regarding the ultimate collectability of principal, all cash receipts are thereafter applied to reduce the recorded investment in the loan. (c) Impaired loans (1) Impaired loans summary Recorded investment Unpaid principal Impaired Impaired Impaired Related RMB RMB RMB RMB RMB As of December 31,2018 417,625,050 415,938,138 358,477,762 57,460,376 157,157,377 As of December 31,2017 299,550,322 294,146,332 242,037,110 52,109,222 98,736,342 In accordance with ASC 310-10-35-16 and 17, impaired loans are those loans where the Group, based on current information and events, believes it is probable all amounts due according to the contractual terms of the loan will not be collected. All amounts due according to the contractual terms means that both the contractual interest payments and the contractual principal payments of a loan will be collected as scheduled in the loan agreement. Impaired loans without an allowance generally represent loans that the fair value of the underlying collateral meets or exceeds the loan’s amortized cost. (2) Average recorded investment in impaired loans Year ended December 31, 2017 2018 Average recorded investment (i) Interest and fees income recognized (ii) Average recorded investment (i) Interest and fees income recognized (ii) RMB RMB RMB RMB Impaired loans 193,518,814 19,502,728 335,515,156 26,786,527 (i) Average recorded investment represents ending balance for the last four quarters and does not include the related allowance for credit losses. (ii) The interest and fees income recognized are those interest and financing service fee recognized related to impaired loans. All the amounts are recognized on cash basis. No debt restructuring in which contractual terms of loans are modified, has occurred during 2017 and 2018. During the year ended December 31, 2018, the Group transferred RMB184,621,473 in carrying amount of loans to third party investors and recorded the transfers as sales. For the year ended December 31, 2018, the Group recognized net loss of RMB16,697,259 from transfers accounted for as sales of loans. Since the fair value of transferred loans was higher than the cost, loans transferred to held-for-sale category was RMB120,822,552, as of December 31, 2018. The Group carries out pre-approval, review and credit approval of loans by professionals for credit risk arising from micro credit business. During the post-transaction monitoring process, the Group conducts a visit of customers regularly after disbursement of loans, and conducts on-site inspection when the Group considers it is necessary. The review focuses on the status of the collateral. The Group adopts a loan risk classification approach to manage the loan portfolio risk. Loans are classified as non-impaired and impaired based on the different risk level. When one or more event demonstrates there is objective evidence of impairment and causes losses, corresponding loans are considered to be classified as impaired. The allowance for credit losses on impaired loans are collectively or individually assessed as appropriate. The Group applies a series of criteria in determining the classification of loans. The loan classification criteria focuses on a number of factors, including (i) the borrower’s ability to repay the loan; (ii) the borrower’s repayment history; (iii) the borrower’s willingness to repay; (iv) the net realizable value of any collateral; and (v) the prospect for the support from any financially responsible guarantor. The Group also takes into account the length of time for which payments of principal and interest on a loan are overdue. |
AVAILABLE-FOR-SALE INVESTMENTS
AVAILABLE-FOR-SALE INVESTMENTS | 12 Months Ended |
Dec. 31, 2018 | |
Debt Securities, Available-for-sale [Abstract] | |
AVAILABLE-FOR-SALE INVESTMENTS | 7. AVAILABLE-FOR-SALE INVESTMENTS The carrying amount, gross unrealized holding gains, gross unrealized holding losses, and fair value of AFS by major security type and class of security at December 31, 2018 and 2017 was as follows: Aggregate cost basis Total OTTI recognized in OCI Gross unrealized holding gains Gross unrealized holding (losses) Aggregate fair value RMB RMB RMB RMB RMB As of December 31, 2018: Wealth management products 680,000,000 - 2,252,159 - 682,252,159 As of December 31, 2017: Wealth management products 360,050,000 - 137,885 - 360,187,885 Wealth management products are investment products issued by commercial banks and other financial institutions in China. The wealth management products invest in a pool of liquid financial assets in the interbank market or exchange, including debt securities, asset backed securities, interbank lending, reverse repurchase agreements and bank deposits. The products can be redeemed on weekdays on demand. The Group has assessed each position for credit impairment. Factors considered in determining whether a loss is temporary include: • The length of time and the extent to which fair value has been below cost; • The severity of the impairment; • The cause of the impairment and the financial condition and near-term prospects of the issuer; • Activity in the market of the issuer which may indicate adverse credit conditions; • The Group’s ability and intent to hold the investment for a period of time sufficient to allow for any anticipated recovery. The Group’s review for impairment generally entails: • Identification and evaluation of investments that have indications of possible impairment; • Analysis of individual investments that have fair values less than amortized cost, including consideration of the length of time the investment has been in an unrealized loss position and the expected recovery period; • Discussion of evidential matter, including an evaluation of factors or triggers that could cause individual investments to qualify as having other-than-temporary impairment and those that would not support other-than-temporary impairment; and • Documentation of the results of these analyses, as required under business policies. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | 8. PROPERTY AND EQUIPMENT December 31, 2017 2018 RMB RMB Office and other equipment 19,997,272 23,774,820 Leasehold improvements 21,147,511 25,062,449 Motor vehicles 1,717,658 1,655,768 Less: accumulated depreciation (20,394,541 ) (31,326,808 ) Total 22,467,900 19,166,229 Total depreciation expense for the years ended December 31, 2018 and 2017 was RMB12,985,972 and RMB10,778,542, respectively, of which was recorded in other expenses in each year. |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS AND GOODWILL | 9. INTANGIBLE ASSETS AND GOODWILL December 31, Note 2017 2018 RMB RMB Intangible assets (a) 3,342,463 4,176,244 (a) Intangible assets December 31,2017 December 31,2018 Gross carrying Accumulated Net carrying Gross carrying Accumulated Net carrying value amortization value value amortization value RMB RMB RMB RMB RMB RMB Amortized intangible assets: Software 7,547,440 (7,174,977 ) 372,463 8,694,496 (7,488,252 ) 1,206,244 Cooperation agreement 5,030,000 (5,030,000 ) - 5,030,000 (5,030,000 ) - Total amortized intangible assets 12,577,440 (12,204,977 ) 372,463 13,724,496 (12,518,252 ) 1,206,244 Unamortized intangible assets: Trademarks 2,970,000 2,970,000 Below table provides the current year and estimated future amortization expense for amortized intangible assets. The Group based its projections of amortization expense shown below on existing asset balances as of December 31, 2018. Future amortization expense may vary from these projections. Software RMB Year ended December 31, 2018 (actual) 313,274 Estimate for year ended December 31, 2019 515,055 2020 489,022 2021 202,167 2022 - 2023 - |
DEPOSITS
DEPOSITS | 12 Months Ended |
Dec. 31, 2018 | |
Deposits [Abstract] | |
DEPOSITS | 10. DEPOSITS Deposits include security deposits to landlords of rental premises and deposits to the China Trust Protection Fund. In accordance with relevant rules of the China Trust Protection Fund, 1% of the size of trust plans subscribed is deposited in the Fund. |
OTHER ASSETS
OTHER ASSETS | 12 Months Ended |
Dec. 31, 2018 | |
Other Assets [Abstract] | |
OTHER ASSETS | 11. OTHER ASSETS Note December 31, 2017 2018 RMB RMB Equity securities (i) 40,010,000 40,010,000 Less: impairment losses - - Receivable from private equity funds - Principal - 21,350,000 - Interest - 4,523,205 Receivables from disposal of subsidiaries 29,658,807 - Prepayments 13,053,454 6,741,881 Receivables for realization of collaterals 10,504,570 7,164,458 Amounts due from employees (ii) 10,027,597 10,126,228 Commission and fee receivables (iii) 6,686,148 2,323,085 Less: impairment losses (2,323,085 ) (2,323,085 ) Other receivables 7,866,237 3,429,580 Total 115,483,728 93,345,352 (i) In December 2013, the Group invested 10% of the paid-in capital in Guangzhou Huangpu Ronghe Village Bank Co., Ltd. (“Huangpu Ronghe”). As of December 31, 2017 and 2018, Huangpu Ronghe has paid-in capital of RMB100,000,000, and the Group has invested RMB10,000,000 in Huangpu Ronghe. In June 2016, the Group invested 2.14% of the paid-in capital in Guangdong Qingyuan Rural Commercial Bank (“Qingyuan Rural”). As of December 31, 2017 and 2018, Qingyuan Rural has paid-in capital of RMB1,400,000,000, and the Group has invested RMB30,010,000 in Qingyuan Rural. The Company’s equity securities that do not have readily determinable fair values are measured at cost minus impairment, and adjusted for changes in observable prices. Factors considered by the Group in determining fair value include, but are not limited to, available financial information, the issuer’s ability to meet its current obligations and indications of the issuer’s subsequent ability to raise capital. These investments were accounted for using cost method during 2017. Under the updated standard ASU 2016-01, these investments are now accounted for using the measurement alternative. No change in observable price has been identified and no impairment has recorded for the two years of 2017 and 2018. (ii) Due from employees mainly include temporary advances to employees for payments of collateral evaluation fee, mortgage handling fee, payments for office supplies, etc. on behalf of the Group. (iii) Commission and fee receivables include commission receivables arising from mortgage agency services, and fee receivables from providing services. The impairment losses for commission and fee receivables was the same as of December 31, 2017 and 2018, amounting to RMB2,323,085. |
INTEREST-BEARING BORROWINGS
INTEREST-BEARING BORROWINGS | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
INTEREST-BEARING BORROWINGS | 12. INTEREST-BEARING BORROWINGS (a) Borrowings under agreements to repurchase Financial assets sold under agreements to repurchase are effectively short-term collateralized borrowings. In these transactions, the Group receives cash in exchange for transferring financial assets as collateral and recognizes an obligation to reacquire the financial assets for cash at the transaction's maturity. These types of transactions create risks, including (1) fair value of the financial assets transferred may decline below the amount of obligation to reacquire the financial assets, and therefore create an obligation to pledge additional amounts, or to replace collaterals pledged, and (2) the Group does not have sufficient liquidity to repurchase the financial assets at the transaction’s maturity. Fixed interest rate Term December 31, 2017 2018 Note RMB RMB Repurchase agreements Funds obtained from Internet funding platforms 9.7% to 14 % 3 to 12 months 1,405,217,000 - Private investment funds 10% to 16 % Less than 1 year 2,042,700,000 2,540,140,000 Asset management company 14 % Less than 1 year - 10,000,000 Financial institution (i) 12.1 % Within 4 years - 1,625,676,189 Interest payable Internet funding platforms 50,757,320 - Private investment funds 13,440,641 20,046,580 Asset management company - 713,425 Financial institution (i) - 17,323,834 Total repurchase agreements 3,512,114,961 4,213,900,028 (i) Funds obtained from financial institutions On June 7, 2018, the Group transferred loans principal, interest and financing service fee receivables with carrying amount RMB499,521,447 to a third-party transferee. The Group transferred loans principal, interest and financing service fee receivables with carrying amount RMB499,999,800, upon a follow-on transfer on November 20, 2018. Xiamen Asset Management Co., Ltd. (“Xiamen Asset”), an unrelated third party, with a 12.1% per annum rate of return. Terms of the loans remain the same after the transfer. However, in accordance with ASC 860, Transfers and Servicing, the loan principals are not derecognized upon transfer as the Group is required to repurchase: (a) the transferred loans which become overdue more than 90 days; (b) the loan principals which is not matured upon the end of the term of the transfer. As of December 31, 2018, the amount of funds obtained from Xiamen Asset and the interest payable are RMB846,513,676 and RMB10,882,954, respectively. On June 15, 2018, the Group transferred loans principal, interest and financing service fee receivables with carrying amount RMB499,991,939 to a third-party transferee, WEIHAI BLUE OCEAN BANK Co.Ltd. (“BLUE OCEAN”), an unrelated third party, with a 12.1% per annum rate of return. Terms of the loans remain the same after the transfer. However, in accordance with ASC 860, Transfers and Servicing, the loan principals are not derecognized upon transfer as the Group is required to repurchase: (a) the transferred loans which become overdue more than 80 days; (b) the loan principals which is not matured upon the end of the term of the transfer. Moreover, when the agreement is in existence for more than 36 months, the Group will be required to repurchase all the remaining loan assets at a price which was agreed in contract. As of December 31, 2018, the amount of funds obtained from BLUE OCEAN and the interest payable are RMB326,580,472 and RMB4,037,910, respectively. On July 11, 2018, the Group transferred loans principal, interest and financing service fee receivables with carrying amount RMB200,000,000 to a third-party transferee, Haide Asset Management Co., Ltd. (“Haide Asset”), an unrelated third party, with a 12.1% per annum rate of return. Terms of the loans remain the same after the transfer. However, in accordance with ASC 860, Transfers and Servicing, the loan principals are not derecognized upon transfer as the Group is required to repurchase: (a) the transferred loans which become overdue more than 90 days; (b) the loan principals which is not matured upon the end of the term of the transfer. As of December 31, 2018, the amount of funds obtained from Haide Asset and the interest payable are RMB152,972,873 and RMB1,906,356, respectively. On December 17, 2018, the Group transferred loans principal, interest and financing service fee receivables with carrying amount RMB299,609,168 to a third-party transferee, Suzhou Asset Management Co., Ltd. (“Suzhou Asset”), an unrelated third party, with a 12.1% per annum rate of return. Terms of the loans remain the same after the transfer. However, in accordance with ASC 860, Transfers and Servicing, the loan principals are not derecognized upon transfer as the Group is required to repurchase: (a) the transferred loans which become overdue more than 90 days; (b) the loan principals which is not matured upon the end of the term of the transfer. As of December 31, 2018, the amount of funds obtained from Xiamen Asset and the interest payable are RMB299,609,168 and RMB496,614, respectively. The below table provides the underlying collateral types of the gross obligations under repurchase agreements. For more information about pledged assets, refer to the Note 12(c). December 31, 2017 2018 RMB RMB Underlying collateral types of gross obligations Repurchase agreements: Rights to earnings in the Group's subordinate tranches of consolidated VIEs 3,265,076,611 2,381,636,580 Rights to earnings in loans principal, interest and financing service fee receivables 247,038,350 189,263,425 Loans principal, interest and financing service fee receivables - 1,643,000,023 Total repurchase agreements 3,512,114,961 4,213,900,028 The below table provides the contractual maturities of the gross obligations under repurchase agreements. Overnight Up to30 days 30 to 90 days Greater than 90 days Total gross obligations RMB RMB RMB RMB RMB Repurchase agreements As of December 31,2018 - 344,050,001 569,088,175 3,300,761,852 4,213,900,028 As of December 31,2017 - 114,331,541 366,877,171 3,030,906,249 3,512,114,961 (b) Other borrowings Other borrowings Note Fixed interest rate per annum Term December 31, 2017 2018 Short-term: RMB RMB Investors of consolidated VIEs (i) 7% to 13 % Less than 1 year 8,123,145,600 4,237,790,000 Investors of internet funding platforms (ii) 9.7% to 14 % 3 to 12 months 184,157,982 - Asset management partnerships (iii) 11% to 15 % Less than 1 year 75,000,000 78,950,000 Trust company (iv) 10.89 % Less than 1 year 110,000,000 - Senior tranche of asset management product which invests in the Group's loans portfolio (v) 8.5 % Less than 1 year 25,992,786 - Investors of wealth management product which invests in the Group's loans portfolio (vi) 11 % Less than 1 year - 10,423,230 Micro-credit companies (viii) 13.5 % Less than 1 year - 30,000,000 Long-term: Investors of consolidated VIEs (i) 11.8%-12.7 % Within 5 years 3,380,980,000 6,548,437,241 Senior tranche of trust plan which invests in the Group's loans portfolio (vii) 10.24 % Within 4 years 131,263,590 82,718,203 Interest payable to Investors of consolidated VIEs (i) 147,849,661 121,127,920 Investors of internet funding platforms (ii) 2,148,517 - Asset management partnerships (iii) 9,860,151 1,275,806 Trust company (iv) 4,854,255 - Senior tranche of asset management product which invests in the Group's loans portfolio (v) 117,284 - Senior tranche of trust plan which invests in the Group's loans portfolio (vii) 451,391 - Micro-credit companies (viii) - 153,611 Total 12,195,821,217 11,110,876,011 (i) The financial liabilities arising from the VIEs with underlying investments in loans to customers are classified as payables in these consolidated financial statements. It is because the Group has an obligation to pay senior tranches holders upon maturity dates of the structured entities based on the related terms of those consolidated structured funds. (ii) The borrowings from investor of internet funding platforms are funds raised from investors like a company named Shenzhen Taotaojin, bearing interest rate from 9.7% to 14% per year. As of December 31, 2018, the borrowings have been fully paid. (iii) As of December 31, 2018, the borrowings from asset management partnerships are from (1) Zhuhai Longhua Qifu NO.1 Fund Partnership (Limited Partnership) with principal RMB50 million, (2) Ningbo Longhua Zhihe Investment Management Partnership (Limited Partnership) with principal RMB20 million, (3) Jilin Northeast Asia Innovation Financial Assets Trading Center Co., Ltd. with principal RMB8.95 million, bearing interest at 11%, 11.47% and 15% per year, respectively. (iv) The borrowings from trust company is from Shanxi Trust Limited Company, bearing interest at 10.89% per year. As of December 31, 2018, the borrowings has been fully paid. (v) The borrowings from senior tranche of asset management product which invests in the Group's loans portfolio are the capitals from senior tranche holders of Zhaoqian Jinjiao Fanhua Asset Management Product, bearing interest at 8.5% per year. As of December 31, 2018, the borrowings has been fully paid. (vi) The borrowings from Investors of wealth management product which invests in the Group's loans portfolio are the capitals from A-class purchasers of Lianda Baoli Co., Ltd., with principal RMB10.42 million on December 31, 2018, bearing interest at 11% per year. (vii) As of December 31, 2018, the borrowings from senior tranche of trust plan which invests in the Group's loans portfolio are the capitals from senior tranche holders of No.1 Wukuang Trust Yangguang Fanhua Plan with principal RMB82.72 million, bearing interest at 10.24% per year. (viii) The borrowings are from Guangdong Province Yueke Technology Micro-credit Co., Ltd. with principal RMB10 million and RMB20 million. The interest-bearing borrowings bear interest at 13.5% and 13% per year, respectively. Aggregate annual maturities of long-term borrowing obligations (based on final maturity dates) are as follows: December 31,2018 2019 2020 2021 2022 2023 Thereafter Total RMB RMB RMB RMB RMB RMB RMB Investors of consolidated VIEs - 5,914,569,684 236,909,800 - 291,705,438 105,252,319 6,548,437,241 Senior tranche of trust plan which invests in the Group's loans portfolio 43,782,203 31,416,000 7,520,000 - - - 82,718,203 Total 43,782,203 5,945,985,684 244,429,800 - 291,705,438 105,252,319 6,631,155,444 (c) Pledged assets The Group pledges certain assets to secure borrowings under agreements to repurchase and other borrowings. The table provides the total carrying amounts of pledged assets by asset types . December 31, 2017 2018 RMB RMB Rights to earnings in the Group's subordinate tranches of consolidated VIEs 4,173,931,373 3,474,391,373 Rights to earnings in loans principal, interest and financing service fee receivables 493,413,547 554,154,772 Loans principal, interest and financing service fee receivables - 1,539,973,217 Total 4,667,344,920 5,568,519,362 Amounts presented above include carrying value of RMB5,369,457,734 and RMB4,409,898,351 in collateral for repurchase agreements as of December 31, 2018 and 2017, respectively. |
OTHER LIABILITIES
OTHER LIABILITIES | 12 Months Ended |
Dec. 31, 2018 | |
Other Liabilities Disclosure [Abstract] | |
OTHER LIABILITIES | 13. OTHER LIABILITIES Note December 31, 2017 2018 RMB RMB Customer pledged deposits (i) 106,006,039 77,726,077 Other tax payables (ii) 75,915,052 89,586,329 Receipt in advance (iii) 6,979,476 44,083,940 Settlement and clearing accounts (iv) - 10,112,678 Amounts due to third parties 7,004,153 10,952,518 Expenses payable to suppliers 10,611,883 8,868,056 Others 17,220,665 10,156,157 Total 223,737,268 251,485,755 (i) Customer pledged deposits mainly consist of the deposits collected from certain customers to reduce the risk of failure to make payments on schedule. (ii) Other tax payables mainly represents value-added tax payables. (iii) Receipt in advance consist of advance for interest and financing service fees on loans and down payments by loan transferees. Down payments are newly increase in 2018, amounting to RMB35,493,777. (iv) The Group transferred loans to third party investors and recorded these transactions as sales in Note 6(c). After the transfer, the contract terms related to payment proceeds of the loans remain the same: the Group collects payments of loans and then disburses the proceeds from the relevant loans to third-party transferees. (v) Other liabilities are expected to be settled or recognized as income within one year or are repayable on demand. |
ORDINARY SHARES
ORDINARY SHARES | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
ORDINARY SHARES | 14. ORDINARY SHARES On January 8, 2014, the Company was incorporated in the Cayman Islands with authorized share capital of HKD380,000 divided into 3,800,000,000 shares of a nominal or par value of HKD0.0001 each. Upon the incorporation of the Company, one subscriber’s share was allotted and issued to Kevin Butler at a consideration of HKD0.0001, representing 100% of the entire ordinary share of the Company. On the same date, such share was transferred to Complete Joy Investments Limited (“Complete Joy”) at nil consideration. As a result, Complete Joy was the sole owner of the Company. On July 11, 2018, the Company repurchased of a total of 1,230,434,041 shares of HKD0.0001 each share, following by issuing a total of 1,230,434,040 shares of USD0.0001 each share. As the result of the above redenomination, the par value of the Company’s shares has been changed from HKD0.0001 to USD0.0001, and its authorized share capital has been increased to USD380,000 divided into 3,800,000,000 shares of USD0.0001 each. Upon the IPO on November 7, 2018 and exercise of the green shoes options, the Company issued 130,000,000 and 8,500,000 ordinary shares, equal to 6,500,000 ADSs and 425,000 ADSs, respectively, priced at USD7.5 per ADS. The Company issued 2,709,200 ordinary shares, equal to 135,460 ADSs, upon a follow-on exercise of the green shoes options on November 21, 2018, priced at USD7.5 per ADS. |
ADDITIONAL PAID-IN CAPITAL
ADDITIONAL PAID-IN CAPITAL | 12 Months Ended |
Dec. 31, 2018 | |
Additional Paid in Capital [Abstract] | |
ADDITIONAL PAID-IN CAPITAL | 15. ADDITIONAL PAID-IN CAPITAL Additional paid-in capital represents (1) the difference between the nominal value of share capital and the paid-up capital of the Group; (2) the difference between the purchase price and the proportionate share of the identifiable net assets of Guangzhou Anyu when the Group acquired its remaining shares to take full ownership; (3) the portion of the grant date fair value of unexercised share options granted to employees of the Group that has been recognized. |
RETAINED EARNINGS
RETAINED EARNINGS | 12 Months Ended |
Dec. 31, 2018 | |
Retained Earnings Note Disclosure [Abstract] | |
RETAINED EARNINGS | 16. RETAINED EARNINGS Note December 31, 2017 2018 RMB RMB PRC statutory reserves (i) 258,654,052 258,654,052 PRC surplus reserves (ii) 63,124,291 122,148,068 Unreserved retained earnings 944,814,653 1,746,699,587 Total 1,266,592,996 2,127,501,707 (i) With effect from July 1, 2012, pursuant to the “Administrative Measures on Accrual of Provisions by Financial Institutions” issued by the MOF in March 2012, the Group is required, in principle, to set aside a general reserve not lower than 1.5% of the ending balance of its gross risk-bearing assets. (ii) In accordance with the Company’s PRC subsidiaries’ articles of associate, the subsidiaries are required to appropriate 10% of their net incomes, upon approval by board of directors. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME/ (LOSSES) | 12 Months Ended |
Dec. 31, 2018 | |
Accumulated Other Comprehensive Income/(Losses) | |
ACCUMULATED OTHER COMPREHENSIVE INCOME/(LOSSES) | 17. ACCUMULATED OTHER COMPREHENSIVE INCOME/(LOSSES) Unrealized gain on available-for-sale investments Foreign Before tax Tax (expenses) Net-of-tax RMB RMB RMB RMB Balance as of January 1, 2018 (4,572,858 ) 137,885 (34,471 ) 103,414 Other comprehensive loss, net (1,682,779 ) 2,114,274 (528,569 ) 1,585,705 Balance as of December 31, 2018 (6,255,637 ) 2,252,159 (563,040 ) 1,689,119 Balance as of January 1, 2017 (4,374,064 ) 3,606,359 (901,590 ) 2,704,769 Other comprehensive loss, net (198,794 ) (3,468,474 ) 867,119 (2,601,355 ) Balance as of December 31, 2017 (4,572,858 ) 137,885 (34,471 ) 103,414 The amounts reclassified out of accumulated other comprehensive income represent realized gains on the available-for-sale investments upon their sales, which were then recorded in " realized gains / (losses) on sales of investments, net " in the consolidated statements of comprehensive income. |
INTEREST AND FINANCING SERVICE
INTEREST AND FINANCING SERVICE FEE ON LOANS | 12 Months Ended |
Dec. 31, 2018 | |
Interest and Fee Income, Loans, Commercial [Abstract] | |
INTEREST AND FINANCING SERVICE FEE ON LOANS | 18. INTEREST AND FINANCING SERVICE FEE ON LOANS Interest and financing service fees on loans, which include financing service fee on loans, are recognized in the consolidated statements of comprehensive income using the effective interest method. Interest income on loans which is recognized with contractual interest rate were RMB1,022,891,039, RMB3,154,190,318 and RMB4,150,727,434 for the year ended December 31,2016, 2017 and 2018, respectively. Financing service fee on loans, are deferred and amortized over the contractual life of the related loans utilizing the effective interest method. Financing service fee on loans were RMB219,237,485, RMB251,920,274 and RMB128,092,934 for the year ended December 31, 2016, 2017 and 2018, respectively. |
REALIZED GAINS_(LOSSES) ON SALE
REALIZED GAINS/(LOSSES) ON SALES OF INVESTMENTS, NET | 12 Months Ended |
Dec. 31, 2018 | |
Realized Investment Gains (Losses) [Abstract] | |
REALIZED GAINS/(LOSSES) ON SALES OF INVESTMENTS, NET | 19. REALIZED GAINS/(LOSSES) ON SALES OF INVESTMENTS, NET The gross realized gains on sales of investments are RMB3,185,026, RMB9,024,132 and RMB106,076,664 for the years ended December 31, 2018, 2017 and 2016, respectively. The gross realized losses on sales of investments are nil and RMB20,551,930 and RMB39,198,163 for the years ended December 31, 2018, 2017and 2016, respectively. |
OTHER GAINS_(LOSSES), NET
OTHER GAINS/(LOSSES), NET | 12 Months Ended |
Dec. 31, 2018 | |
Other gains/(losses), net | |
OTHER GAINS/(LOSSES), NET | 20. OTHER GAINS/(LOSSES), NET Years ended December 31, Note 2016 2017 2018 RMB RMB RMB Mortgage agency service revenue (i) 12,373,044 8,395,774 4,466,608 Asset management revenue (ii) 9,628,621 1,316,186 - Net gain on disposal of subsidiaries - 6,060,758 - Labour outsourcing services income (iii) 12,035,445 7,857,461 - Foreign exchange gain/(loss) 2,717,820 (2,274,438 ) 1,836,029 Register services income 238,500 183,010 - Net loss on disposal of property and equipment (61,085 ) (261,875 ) (946,244 ) Net loss on sale of loans - - (16,697,259 ) Others (670,412 ) 2,702,734 (3,242,074 ) Total 36,261,933 23,979,610 (14,582,940 ) (i) The Group earns fees from providing mortgage agency services to borrowers applying for a bank loan. This kind of revenue is recognized at the time when loan is granted as that is the point of time the Group fulfils the customer’s request, and is then recognized on an accrual basis in accordance with the terms of the relevant agreements. Mortgage agency service revenue consists of revenue earned from housing mortgage agency service and cars mortgage agency service, which accounted for 59.73% and 40.27% of mortgage agency service revenue in the year of 2018, respectively. (ii) The Group receives asset management revenue from providing asset management services for investors. The asset management revenue is calculated and accrued on a daily basis based on the daily net asset value of the asset management products under management. The asset management business has been disposed of in 2017. (iii) The Group receives labour outsourcing services income from providing labour outsourcing services to clients by one of the subsidiaries of the Group. Labour outsourcing services income are recognized on an accrual basis in accordance with the terms of the relevant agreements. As the subsidiary was disposed of in 2017, there would be no such income in the future. |
OTHER EXPENSES
OTHER EXPENSES | 12 Months Ended |
Dec. 31, 2018 | |
Other Expenses [Abstract] | |
OTHER EXPENSES | 21. OTHER EXPENSES Years ended December 31, 2016 2017 2018 RMB RMB RMB Consulting fees 5,736,437 9,282,890 38,031,501 Advertising and promotion expenses 16,383,290 15,028,164 15,323,838 Office expenses 14,453,830 18,769,477 14,425,608 Entertainment and travelling expenses 11,767,688 14,506,006 14,237,820 Depreciation and amortization 6,595,476 10,804,855 13,299,246 Communication expenses 2,530,162 2,598,250 2,549,164 Research and development expenses 8,507,265 4,794,998 1,419,878 Asset management expenses 3,887,977 - - Provision for cost method investment 1,270,001 - - Others 4,675,782 6,409,916 14,268,602 Total 75,807,908 82,194,556 113,555,657 |
INCOME TAX EXPENSE
INCOME TAX EXPENSE | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAX EXPENSE | 22. INCOME TAX EXPENSE Cayman Islands Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gains. British Virgin Islands (BVI) Pursuant to the rules and regulations of the British Virgin Islands, the Group is not subject to any income tax in the British Virgin Islands. Hong Kong No provision for Hong Kong Profits Tax has been made for the subsidiary located in Hong Kong as the subsidiary has not derived any income subject to Hong Kong Profits Tax during the years. Peoples Republic of China (PRC) According to the PRC Corporate Income Tax (“CIT”) Law that was effective from January 1, 2008, the Group’s PRC subsidiaries are subject to PRC income tax at the statutory tax rate of 25%, unless otherwise specified. Shenzhen Taotaojin Internet Financial Services Company Limited (“Taotaojin”) was granted the “qualified software enterprise” status in 2015 and was entitled to a 50 percent reduction of the income tax rate for the years ended December 31, 2017 to 2019. Taotaojin was disposed by the Group in September 2017. The effect of tax holiday to income tax expense is RMB38 million, RMB4 million and nil million in 2016, 2017 and 2018, respectively. Basic earnings per ordinary share effect of the Group’s tax holiday for the year ended December 31, 2016, 2017 and 2018 was RMB0.031, RMB0.003 and nil, respectively. Diluted earnings per ordinary share effect of the Group’s tax holiday for the year ended December 31, 2016, 2017 and 2018 was RMB0.031, RMB0.003 and nil, respectively. Income tax expense, all of which relates to the PRC, consists of the following for the years ended December 31: Years ended December 31, 2016 2017 2018 RMB RMB RMB Current tax expense 86,073,560 333,883,691 401,913,951 Deferred tax benefit (33,470,137 ) (57,888,823 ) (105,085,476 ) Total income tax expense 52,603,423 275,994,868 296,828,475 The principal components of the deferred tax assets and liabilities are as follows: Years ended December 31, 2017 2018 RMB RMB Deferred tax assets: Allowance for loans principal 105,191,243 205,058,644 Allowance for interest and financing fee receivables 5,473,550 11,281,778 Allowance for available-for-sale investments - - Net operating loss carry-forwards 12,610,881 5,743,768 Other deferred tax assets 1,865,154 1,275,001 Subtotal of deferred tax assets 125,140,828 223,359,191 Valuation allowance (12,610,881 ) (5,743,768 ) Total deferred tax assets 112,529,947 217,615,423 Deferred tax liabilities: Intangible assets (742,500 ) (742,500 ) Available-for-sale investments (34,471 ) (563,040 ) Total deferred tax liabilities (776,971 ) (1,305,540 ) Movement of valuation allowance : 2017 2018 RMB RMB At the beginning of year 21,743,157 12,610,881 Current year additions 8,512,244 1,572,672 Current year reversals (2,433,708 ) (8,391,178 ) Current year charge-offs (25,800 ) (48,607 ) Current year disposal (15,185,012 ) - At the end of year 12,610,881 5,743,768 In assessing the recoverability of its deferred tax assets, management considers whether some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the cumulative earnings and projected future taxable income in making this assessment. Recovery of substantially all of the Group’s deferred tax assets is dependent upon the generation of future income, exclusive of reversing taxable temporary differences. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are recoverable, management believes that it is more likely than not that the Group will realize the benefits of its deferred tax assets as of December 31, 2016, 2017 and 2018. Valuation allowance have been provided on deferred tax asset due to the uncertainty surrounding their realization. As of December 31, 2016, 2017 and 2018, the valuation allowance on deferred tax assets mainly arising from tax loss carry-forwards were provided because it was more likely than not that the Group will not be able to utilize tax loss carry-forwards and certain deductible expenses generated by certain unprofitable subsidiaries. The Company operates through its subsidiaries and VIEs. The valuation allowance is considered on an individual entity basis. As of December 31, 2018, the Company had net operating loss carry-forwards of RMB22,975,070 from its subsidiaries registered in the PRC, which can be carried forward to offset future taxable income. The Company had deferred tax assets related to net operating loss carry-forwards of RMB5,743,768. Net operating losses of RMB16,684,382 will expire in year in 2022, and in 2023, about RMB6,290,688 will expire, if not utilized. The Company assessed the available evidence to estimate if sufficient future taxable income would be generated to use the existing deferred tax assets. Management intends to indefinitely reinvest the undistributed earnings of the subsidiaries located in the PRC. The cumulative amount of the temporary difference in respect of investments in PRC subsidiaries is RMB2,163,633,590 as of December 31, 2018. Upon repatriation of the subsidiaries’ and the VIE’s earnings, in the form of dividends or otherwise, the Group would be subject to 10% PRC withholding income tax when making distribution to foreign parent companies. However, the Group was not subject to withholding income tax in 2018 because the Group did not make any distribution to foreign parent companies. The related unrecognized deferred tax liabilities were approximately RMB216,363,359. The income before income tax is as follows: Years ended December 31, 2016 2017 2018 RMB RMB RMB Non-PRC entities (564,877 ) (8,903,856 ) 79,256 PRC entities 288,610,139 817,571,481 1,157,657,930 Total 288,045,262 808,667,625 1,157,737,186 The reconciliation of the PRC statutory income tax rate of 25% to the effective income tax rate is as follows: Years ended December 31, 2016 2017 2018 PRC statutory income tax rate 25.00 % 25.00 % 25.00 % (Decrease)/Increase in effective income tax rate resulting from: Effect of tax holiday (13.16 )% (0.51 )% 0.00 % Effect of tax-free income (8.10 )% (4.00 )% (0.03 )% Effect of disposal of subsidiaries 0.00 % 6.53 % 0.00 % Effect of Non-deductible share option expense 0.00 % 5.65 % 0.86 % Effect of zero tax rate in foreign countries (0.02 )% 0.27 % (0.00 )% Effect of transfer pricing 6.88 % 0.32 % 0.00 % Changes in valuation allowance 5.73 % 0.75 % (0.59 )% Others 1.93 % 0.11 % 0.42 % Effective income tax rate 18.26 % 34.12 % 25.66 % The Group’s only major jurisdiction is China where tax returns generally remain open and subject to examination by tax authorities for tax years 1999 onwards. The Group did not have any significant unrecognized tax benefits, and no interest and penalty expenses were recorded for the years ended December 31, 2016, 2017 and 2018. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | 23. EARNINGS PER SHARE The following table sets forth the computation of basic and diluted earnings per share for the years ended December 31, 2016, 2017 and 2018, for which the basic weighted average number of common shares are based on the 1,230,434,041, 1,230,434,041 and 1,371,643,240 common shares issued by the Company, as if those shares were issued as of the earliest date presented. Years ended December 31, 2016 2017 2018 RMB RMB RMB Net income 235,441,839 532,672,757 860,908,711 Basic weighted average number of common shares outstanding 1,230,434,041 1,230,434,041 1,251,608,224 Effect of dilutive share options - 100,975,533 137,727,545 Dilutive weighted average number of ordinary shares 1,230,434,041 1,331,409,574 1,389,335,769 Basic earnings per share 0.19 0.43 0.69 Diluted earnings per share 0.19 0.40 0.62 |
SHARE-BASED COMPENSATION EXPENS
SHARE-BASED COMPENSATION EXPENSES | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
SHARE-BASED COMPENSATION EXPENSE | 24. SHARE-BASED COMPENSATION EXPENSE (a) Description of share-based compensation arrangements On November 1, 2009, the Group adopted a share incentive plan, or the 2009 Share Incentive Plan, granting options to its directors and employees to purchase up to 25,678 ordinary shares of the Group. Pursuant to the option agreements entered into between the Group and the option grantees, the options shall vest over a five-year period from 2010 to 2014. The number of options that the grantees are entitled to in each year will be calculated based on the key performance indicator scores of the grantees in the respective prior year and continued employment is not regarded as vesting condition. Accordingly, 60%, 10%, 10%, 10% and 10% of the award options shall vest on January 1, each of the years 2010 to 2014, respectively. On January 24, 2011, the Group divided the existing issued shares, USD0.10 each share into USD0.01 each share. On the same day, the Group allotted and issued new shares to its existing shareholders in accordance with the ratio of 1:637. Upon completion of such share split and share allotment, the number of such share options was adjusted from 25,678 to 163,825,640. Accordingly, the exercise price was adjusted from RMB3,190 to RMB0.5. The expiration date of such options was December 31, 2016 and as of December 31, 2016, no option has been excised. On January 3, 2017, the Group adopted a new share incentive plan, or the 2017 Share Incentive Plan. Options to purchase 187,933,730 ordinary shares pursuant to the 2017 Share Incentive Plan were issued to certain management and employees. Accordingly, 60%, 20% and 20% of the award options shall vest on December 31, each of the years 2017 to 2019, respectively. Unless terminated earlier, the 2017 Share Incentive Plan will terminate automatically in 2022. On August 27, 2018, a 2018 Share Incentive Plan for granting shares award of CNFinance to certain management and employees of the Group is issued to concurrent replace the 2017 Share Incentive Plan which granted Sincere Fame’s share. Except for the above mentioned change of grantor, all terms of the 2017 Share Incentive Plan and the 2018 Share Incentive Plan are the same. No change in the fair value, vesting conditions or the classification of the 2017 Share Incentive Plan and the 2018 Share Incentive Plan. Share-based payment transactions with employees, such as share options are measured based on the grant date fair value of the equity instrument. The Group recognizes the compensation costs net of estimated forfeitures over the applicable vesting period. The estimate of forfeitures will be adjusted over the requisite service period to the extent that actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures will be recognized through a cumulative catch-up adjustment in the period of change and will also impact the amount of stock compensation expenses to be recognized in future periods. There was no market conditions associated with the share option grants. (b) Fair value of share options and assumptions The fair value of options granted to employees is determined based on a number of factors including valuations. In determining the fair value of our equity instruments, the Group referred to valuation reports prepared by an independent third-party appraisal firm, based on data the Group provided. The valuation reports provided the Group with guidelines in determining the fair value of the equity instruments, but the Group are ultimately responsible for the determination of all amounts related to share-based compensation recorded in the financial statements. Excluding the options containing service vesting conditions, the Group calculated the estimated fair value of the options on the respective grant dates using a binomial option pricing model with assistance from independent valuation firms, with the following assumptions: Share awards granted on November 1, 2009 Share awards granted on January 3, 2017 Expected volatility 71 % 40 % Expected dividends - - Risk-free interest rate 3.50 % 3.10 % Expected term (in years) 5 5 Expected life (in years) 7.17 6 The contractual life of the share option is used as an input into the binomial option pricing model. Exercise multiple and post-vesting forfeit are incorporated into the model. Since the Group’s shares did not have been publicly traded at the time the options were issued and its shares were rarely traded privately, expected volatility is estimated based on the average historical volatility of comparable entities with publicly traded shares for the period before the date of grant with length commensurate to contractual life of the options. The risk-free rate for the expected term of the option is based on the yield to maturity of China 6-year government bond at the date of grant. The Group has not declared or paid any cash dividends on its capital stock, and does not anticipate any dividend payments on its ordinary shares in the foreseeable future. If any of the assumptions used in the binomial option pricing model changes significantly, share-based compensation expenses for future awards may differ materially compared with the awards granted previously. A summary of share option activity under the 2017 and 2018 Plan is as follows: Number of Weighted exercise price Weighted RMB RMB Balance, December 31, 2016 - - - Granted 187,933,730 - 1.27 Exercised - - - Surrendered - - - Balance, December 31, 2017 187,933,730 - 1.27 Exercisable, December 31, 2017 112,760,238 - 1.27 Expected to vest, December 31, 2017 75,173,492 - 1.27 Balance, December 31, 2017 187,933,730 - 1.27 Granted - - - Exercised - - - Surrendered - - - Balance, December 31, 2018 187,933,730 - 1.27 Exercisable, December 31, 2018 150,346,984 - 1.27 Expected to vest, December 31, 2018 37,586,746 - 1.27 The following table sets forth the fair value of options and ordinary shares estimated at the dates of option grants indicated below with the assistance from an independent valuation firm. Date of options grant Options Exercise Fair value Fair value of ordinary shares November 1, 2009 25,678 RMB3,190 RMB640.10 RMB1,506 January 3, 2017 75,173,492 RMB0.50 RMB1.26 RMB1.72 January 3, 2017 112,760,238 RMB0.50 RMB1.27 RMB1.72 For the option granted on November 1, 2009, the Group recognized compensation expenses up to RMB16,435,974 and for the option granted on January 3, 2017, the Group recognized compensation expenses of RMB182,689,766 and RMB39,715,168 in year 2017 and 2018, respectively. There was no income tax benefit recognized associated with the share-based compensation expenses. As of December 31, 2018, there was RMB15,886,067 of total unrecognized compensation cost related to unvested stock options granted under the Plan. That cost is expected to be recognized over a weighted average period of 1 year. |
MATERIAL RELATED PARTY TRANSACT
MATERIAL RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
MATERIAL RELATED PARTY TRANSACTIONS | 25. MATERIAL RELATED PARTY TRANSACTIONS Name and relationship with related parties During the years, transactions with the following parties are considered as related parties: Name of related party Relationship CISG Holdings Limited one of the shareholders Mr. Zhai Bin Chairman and Chief Executive Officer of the Group Fanhua Inc. and its subsidiaries one of the owners beneficially owns 100% equity interests of CISG Holdings Limited The Group’ s related parties, Fanhua Inc. and its subsidiaries signed an agreement with the Group that agreed to grant a revolving loan with a maximum amount of USD50,000,000 (equivalent to RMB317,990,000 as per the agreement) to the Group. The amounts are unsecured and bear market interest rate at 7.3% per year and are repayable on demand. The principals were settled in 2015. As of December 31, 2016, the principals and interests payable to Fanhua Inc. and its subsidiaries were nil and RMB32,494,914, respectively. During the year of 2017, the Group paid off all the interests to Fanhua Inc. and its subsidiaries. In the year of 2017, the Group had borrowings transactions with Fanhua Inc. and its subsidiaries, which totally amounted up to RMB460,000,000 used for short-term cash flow, bearing market interest rate at 7.3% per year. As of December 31, 2017, the Group paid off all the principals and interest expense amounted RMB8,714,000 generated from the borrowings this year. In 2017, the Chairman and Chief Executive Officer of the Group, Mr. Zhai Bin, entered into a loan agreement with the Group as lender with an amount of RMB5,010,800 with a daily market interest rate of 0.02%. The loan was settled in full in March 2018. In May 2018, Jinghua Structure Fund 27, a VIE consolidated by the Group, was established with a contracted valid term for 10 years. Fanhua Inc. and its subsidiaries subscribed all of the senior units and intermediate units of Jinghua Structure Fund 27, which amounted to RMB115,000,000 and RMB23,000,000 respectively. The Group subscribed to all of the subordinated units of Jinghua Structure Fund 27 as well, which amounted to RMB15,350,000. In 2018, Fanhua Inc. and its subsidiaries transferred all their senior units and intermediate units to a third party of the Group from May to July. As a result, amounts due to related parties is nil as of December 31, 2018. The total amount of interest expense of Jinghua Structure Fund 27 in 2018 is RMB6,308,306. As the result of the above transferring, interest expense paid to related parties is RMB610,405. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 26. COMMITMENTS AND CONTINGENCIES Operating leases commitment The Group leases certain office premises under non-cancelable leases. Rental expenses under operating lease for the year ended December 31, 2016, 2017 and 2018 were RMB24,404,690,RMB47,896,817 and RMB58,317,758 respectively. As of December 31, 2018, the total future minimum lease payments under non-cancellable operating leases are payable as follows: As of December 31, RMB 2019 55,912,805 2020 31,600,761 2021 17,417,081 2022 10,701,271 2023 4,601,398 Later years, through 2025 5,247,712 Total 125,481,028 The Group is the lessee in respect of a number of properties held under operating leases. The leases typically run for an initial period of 1-3 years, at the end of which period all terms are renegotiated. The leases do not include contingent rentals. The Group’s operating lease commitments have no renewal options, rent escalation clauses and restriction or contingent rents. |
CONDENSED FINANCIAL INFORMATION
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information Disclosure [Abstract] | |
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY | 27. CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY The Company’s PRC VIEs and PRC subsidiaries are restricted in their ability to transfer a portion of their net assets to the Company. The payment of dividends by entities organized in China is subject to limitations, procedures and formalities. Regulations in the PRC currently permit payment of dividends only out of accumulated profits as determined in accordance with accounting standards and regulations in China. The Company’s subsidiaries are also required to set aside at least 10% of its net income based on PRC accounting standards each year to its statutory reserves account until the accumulative amount of such reserves reaches 50% of its respective registered capital. The aforementioned reserves can only be used for specific purposes and are not distributable as cash dividends. In addition, the Company’s operations and revenues are conducted and generated in China, all of the Company’s revenues being earned and currency received are denominated in RMB. RMB is subject to the foreign exchange control regulation in China, and, as a result, the Company may be unable to distribute any dividends outside of China due to PRC foreign exchange control regulations that restrict the Company’s ability to convert RMB into US Dollars. Regulation S-X requires the condensed financial information of registrant shall be filed when the restricted net assets of consolidated subsidiaries exceed 25 percent of consolidated net assets as of the end of the most recently completed fiscal year. For purposes of the above test, restricted net assets of consolidated subsidiaries shall mean that amount of the registrant’s proportionate share of net assets of consolidated subsidiaries (after intercompany eliminations) which as of the end of the most recent fiscal year may not be transferred to the parent company by subsidiaries in the form of loans, advances or cash dividends without the consent of a third party. The condensed parent company financial statements have been prepared in accordance with Rule 12-04, Schedule I of Regulation S-X as the restricted net assets of the Company’s PRC subsidiary and VIE exceed 25% of the consolidated net assets of the Company. The condensed financial information of the parent company has been prepared in accordance with SEC Regulation S-X Rule 5-04 and Rule 12-04, using the same accounting policies as set out in the Company’s consolidated financial statements, except that the Company uses the equity method to account for investments in its subsidiaries. The footnote disclosures generally included in financial statements prepared in accordance with U.S. GAAP have been condensed and omitted. The footnote disclosures contain supplemental information relating to the operations of the Company, as such, these statements are not the general-purpose financial statements of the reporting entity and should be read in conjunction with the notes to the consolidated financial statements of the Company. On January 8, 2014, the Company was incorporated in the Cayman Islands with one subscriber’s share allotted and issued at par value of HKD0.0001, representing 100% of the entire ordinary share of the Company. The shareholder as well as shareholder’s equity remained the same until the reorganization with Sincere Fame. Condensed balance sheets December 31, 2018 RMB Assets Cash and cash equivalents 319,807,618 Investments in subsidiaries 392,559,403 Total assets 712,367,021 Liabilities and shareholders' equity Other operating liabilities 8,158,984 Total liabilities 8,158,984 Ordinary shares (3,800,000,000 shares authorized, 1 share with HKD0.0001 as par value and 1,371,643,240 shares with USD0.0001 as par value issued as of December 31, 2017 and December 31, 2018, respectively) 916,743 Additional paid-in capital 705,422,445 Retained earnings (5,672 ) Accumulated other comprehensive income: Foreign currency translation adjustment (2,125,479 ) Total shareholders’ equity 704,208,037 Total liabilities and shareholders' equity 712,367,021 Condensed statements of comprehensive income 2018 RMB Operating expenses Administration Expense (5,672 ) Total operating expenses (5,672 ) Income before income tax (5,672 ) Net loss (5,672 ) Other comprehensive losses Foreign currency translation adjustment (2,125,479 ) Comprehensive income (2,131,151 ) Condensed statements of cash flows 2018 RMB Cash flows from operating activities: Net loss (5,672 ) Other operating liabilities 7,311 Net cash provided by operating activities 1,639 Cash flows from financing activities: Proceeds from initial public offering, net of offering cost paid of RMB51,967,702 in 2018 321,930,733 Net cash provided by financing activities 321,930,733 Net increase in cash and cash equivalents 321,932,372 Cash and cash equivalents at the beginning of year - Effect of exchange rate change on cash and cash equivalents (2,124,754 ) Cash and cash equivalents at the end of year 319,807,618 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 28. SUBSEQUENT EVENTS Management has considered subsequent events through April 25, 2019, which was the date these consolidated financial statements were issued. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Principles of consolidation | (a) Principles of consolidation The accompanying consolidated financial statements include the financial statements of the Group, its subsidiaries and consolidated VIEs. All intercompany transactions and balances have been eliminated in consolidation. The Group accounts for investments over which it has significant influence but not a controlling financial interest using the equity method of accounting. |
Currency translation for financial statements presentation | (b) Currency translation for financial statements presentation The Group uses Renminbi (“RMB”) as its reporting currency. The United States Dollar (“USD”) is the functional currency of the Company incorporated in Cayman and the Group’s subsidiary Sincere Fame incorporated in British Virgin Islands, and the Hong Kong Dollar(“HKD”) is the functional currency of the Group’s subsidiary China Financial Services Group Limited incorporated in Hong Kong and the RMB is the functional currency of the Group’s PRC subsidiaries. The financial statements of the Group are translated from the functional currency to the reporting currency, RMB. Assets and liabilities of the subsidiaries are translated into RMB using the exchange rate in effect at each balance sheet date. Income and expenses items are generally translated at the average exchange rates prevailing during the fiscal year. Foreign currency translation adjustments arising from these are accumulated as a separate component of shareholders’ deficit on the consolidated financial statements. The resulting exchange differences are recorded in the consolidated statements of comprehensive income/ (losses). |
Use of estimates | (c) Use of estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include, allowance for loans principal, interest and financing service fee receivables, the valuation allowance for deferred tax assets, the unrecognized tax benefits and indefinite reinvestment assertion, the fair value of available-for-sale investments and the fair value of share-based compensation. |
Revenue recognition | (d) Revenue recognition Interest and financing service fee on loans which are amortized over the contractual life of the related loans are recognized in consolidated statements of comprehensive income in accordance with ASC 310 using the effective interest method. Mortgage agency service revenue, asset management revenue and revenue from rendering of services are recognized in accordance with ASC 606 when following conditions are met: identify the contract(s) with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract and recognize revenue when (or as) the entity satisfies a performance obligation. The criteria of revenue recognition as they relate to each of the following major revenue generating activities are described below: (i) Interest and financing service fee on loans Interest and financing service fee on loans, which include financing service fee on loans, are collected from borrowers for loans and related services. Interest and financing service fee on loans includes the amortization of any discount or premium or differences between the initial carrying amount of an interest-bearing asset and its amount at maturity calculated using the effective interest basis. The effective interest method is a method of calculating the amortized cost of a financial asset and of allocating the interest and financing service fee on loans over the years. The effective interest rate is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument. When calculating the effective interest rate, the Group estimates cash flows considering all contractual terms of the financial instrument but does not consider future credit losses. Interest on the impaired assets is recognized using the rate of interest used to discount future cash flows. (ii) Mortgage agency service revenue and asset management revenue The Group earns mortgage agency service revenue from providing mortgage agency services to borrowers applying for a bank loan. This kind of revenue is recognized at the time when loan is granted as that is the point of time the Group fulfils the customer’s request, and is then recognized on an accrual basis in accordance with the terms of the relevant agreements. The Group receives asset management revenue from providing asset management services for investors. The asset management revenue is calculated and accrued on a daily basis based on the daily net asset values of the asset management products under management. (iii) Realized gains/ (losses) on sales of investments Realized gains/ (losses) consist of realized gains and losses from the sale of available-for-sale investments, presented on a net basis. (iv) Rendering of services When the outcome of a transaction involving the rendering of services can be estimated reliably, revenue from the rendering of services is recognized by reference to the stage of completion of the transaction based on the services performed to date as a percentage of the total services to be performed. When the outcome of a transaction involving the rendering of services cannot be estimated reliably, revenue is recognized only to the extent of the costs incurred that it is probably recoverable. |
Loans | (e) Loans Loans are reported at their outstanding principal balances net of any unearned income and unamortized deferred fees and costs. Loan origination fees and certain direct origination costs are generally deferred and recognized as adjustments to income over the lives of the related loans. The Group facilitates credit to borrowers through structure funds which are considered as consolidated VIEs and the Group evaluated VIEs for consolidation in accordance with ASC 810 in the Consolidated VIEs Section of Note 1. Providing credit enhancement and top-up arrangement for the loans to customers under the funds is one of the key factors to determine that the Group should consolidate the structure funds as it is the primary beneficiary of the funds. As a result, the loan principal remains on the Group’s consolidated balance sheets, whilst the funds received from senior tranches holders are recorded as Other Borrowings in the Group’s consolidated balance sheets as disclosed in Note 12(b)(i). Non-accrual policies Loans principal, interest and financing service fee receivables are placed on non-accrual status when payments are 90 days contractually past due. When a loan principal, interest and financing service fee receivable is placed on non-accrual status, financing service fees accrual ceases. If the loan is non-accrual, the cost recovery method is used and cash collected is applied to first reduce the carrying value of the loan. Otherwise, interest income may be recognized to the extent cash is received. Loans principal, interest and financing service fee receivables may be returned to accrual status when all of the borrower’s delinquent balances of loans principal, interest and financing service fee have been settled and the borrower continue to perform in accordance with the loan terms for a period of at least six months. Charge-off policies Loans principal, interest and financing service fee receivables are charged off when the Group has determined the remaining balance is uncollectable after exhausting all collection efforts. In order to comply with ASC 310, the Group considers loans principal, interest and financing service fee receivables meeting any of the following conditions as uncollectable and charged-off: (i) death of the borrower; (ii) identification of fraud, and the fraud is officially reported to and filed with relevant law enforcement departments or (iii) the Group concludes that it has exhausted its collection efforts. Allowance for credit losses Allowance for credit losses represents management’s best estimate of probable losses inherent in the portfolio. The allowance for credit losses includes an asset-specific component and a statistically based component. The asset-specific component is calculated under ASC 310-10-35, on an individual basis for the loans whose payments are contractually past due more than 90 days or which are considered impaired. An asset-specific allowance is established when the discounted cash flows, collateral value (less disposal costs) or observable market price of the impaired loan are lower than its carrying value. This allowance considers the borrower’s overall financial condition, resources, and payment record, the prospects for support from any financially responsible guarantors and, if appropriate, the realizable value of any collateral. The allowance for the remainder of the loan portfolio is determined under ASC 450 using a roll rate-based model. The roll rate-based model stratifies the loan principal, interest and financing service fee receivables by delinquency stages which are divided by days overdue and projected forward in next stage using probability of default. In each stage of the simulation, losses on the loan principal, interest and financing service fee receivables types are captured, and the ending delinquency stratification serves as the beginning point of the next iteration. This process is repeated on a monthly rolling basis. The loss rate calculated for each delinquency stage using loss given default, then applied to the respective loan principal, interest and financing service fees balance. The Group adjusts the allowance that is determined by the roll rate-based model for various Chinese macroeconomic factors (i.e. gross-domestic product rates, interest rates and consumer price indexes). Each of these macroeconomic factors are equally weighted, and a score is applied to each factor based on year-on-year increases and decreases in that respective factor. Loans held-for-sale Held-for-sale loans are measured at the lower of cost or fair value, with valuation changes recorded in noninterest revenue. The valuation is performed on an individual loan basis. Loan origination fees or costs and purchase price discounts or premiums are deferred in a contra loan account until the related loan is sold. The deferred fees or costs and discounts or premiums are an adjustment to the basis of the loan and therefore are included in the periodic determination of the lower of cost or fair value adjustments and/or the gain or loss recognized at the time of sale. |
Cash and cash equivalents | (f) Cash and cash equivalents Cash and cash equivalents primarily consist of cash, deposits which are highly liquid and all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. The Company considers highly liquid investments that are readily convertible to known amounts of cash. |
Available-for-sale ("AFS") investments | (g) Available-for-sale (“AFS”) investments The Group classifies wealth management products and asset management products as available-for-sale ("AFS") investments. AFS investments are recorded at fair value. Unrealized holding gains and losses, net of the related tax effect, on AFS investments are excluded from earnings and are reported as a separate component of accumulated other comprehensive income until realized. Realized gains and losses from the sale of AFS investments are determined on a specific identification basis and are recorded as realized gains/ (losses) on sales of investments. Interest and investment income are recognized when earned. |
Property and equipment | (h) Property and equipment Property and equipment are stated at cost. Depreciation on equipment is calculated on the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of the economic useful life of the improvement or the term of the lease. The estimated useful life of office and other equipment range from 1 to 5 years, the estimated useful life of leasehold improvements or the term of the lease range from 1 to 6 years, while the estimated useful lives of motor vehicles range from 3 to 8 years. |
Goodwill | (i) Goodwill Goodwill is an asset representing the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. On August 31, 2006, the Group acquired a 55% stake in Guangzhou Anyu Mortgage Consulting Co., Limited (“Guangzhou Anyu”). On the acquisition date, the fair value of Guangzhou Anyu’s identifiable net assets was RMB42.36 million, 55% of which the Group accounted for was RMB23.3 million. An amount of RMB20.28 million was recognized as goodwill, representing the excess of the consideration transferred over the Group’s proportionate share of the fair value of identifiable net assets. On May 25, 2009, the Group acquired the remaining 45% shares in Guangzhou Anyu for RMB27.47 million. Guangzhou Anyu was incorporated in the PRC in 2003 and was primarily engaged in the business of providing mortgage agency services and loans at the time of acquisition. Impairment tests for cash-generating units containing goodwill Goodwill is not amortized on a recurring basis, but rather are subject to periodic impairment testing. The Group reviews goodwill annually for impairment or when circumstances indicate that the carrying value may exceed the fair value. The Group compares the carrying value of goodwill to its estimated fair value, which is based on the expected present value of future cash flows, comparable public companies and acquisitions or a combination of both. The quantitative analysis requires a comparison of the fair value to carrying amount. If the fair value of the reporting unit is in excess of the carrying value, the related goodwill is considered not to be impaired and no further analysis is necessary. If the carrying value of the reporting unit is higher than the fair value, impairment is measured as the excess of the carrying amount over the fair value. The recoverable amount of the cash-generating-units (“CGU”) is calculated using Dividend Discount Model (DDM). The projected cash flow for the next year is based on financial budgets approved by management. Cash flows beyond next year are estimated using a weighted average growth rate of 3%, which is consistent with the forecasts in industry research reports. The growth rate does not exceed the long-term average growth rates for the business in which the CGU operates. The projected cash flows are then discounted using a discount rate of 21% as of December 31, 2016. The discount rate is pre-tax and reflects specific risks relating to the relevant segments. In 2016, the key management of Guangzhou Anyu has left the company. Guangzhou Anyu's business model has changed from providing loans to referring micro credit business to other entities of the Group, resulting in an expected reduction in the operating profits and cash flows in the future. Therefore, the Group recognized a goodwill impairment loss of RMB20,279,026. The goodwill was fully impaired as of December 31, 2016. |
Intangible assets | (j) Intangible assets Indefinite-lived intangible assets are assets that are not amortized because there is no foreseeable limit to cash flows generated from them. Intangible assets with finite useful lives are amortized on a straight line basis over their estimated useful lives. The Group categorizes trademarks as indefinite-lived intangible assets, whose carrying value is RMB2.97 million. If it is more likely than not that the asset is impaired, the Group records the amount that the carrying value exceeds the fair value as an impairment expense. The Group performed its annual impairment review of indefinite-lived intangible assets on December 1, 2018 and 2017 and determined that it is more likely than not that the carrying values were less than the fair values. Intangible assets with finite useful lives represent software and cooperation agreements, the estimated useful lives of which are 1 to 5 years and 5 years, respectively. As of December 31, 2018 and 2017, accumulated amortization were RMB12,518,252 and RMB12,204,977, respectively. |
Income tax | (k) Income tax Income tax is accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and for their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Group recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50 percent likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Group classifies interest and penalties recognized on the liability for unrecognized tax benefits as income tax expense. |
Employee benefit plans | (l) Employee benefit plans Pursuant to relevant PRC regulations, the Group is required to make contributions to various employee benefit plans organized by municipal and provincial PRC governments. The contributions are made for each PRC employee at statutory rates as determined by local social security bureau. Contributions to the employee benefit plans are charged to the consolidated statements of income. The Group has no obligations for payment of pension benefits associated with the plans beyond the amount it is required to contribute. |
Long-lived assets | (m) Long-lived assets Long-lived assets, such as property and equipment, and purchased intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, the Group first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. |
Share-based compensation | (n) Share-based compensation The Group measures the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award and recognizes the cost over the period the employee is required to provide service in exchange for the award, which generally is the vesting period. The Group recognizes compensation cost for an award with only service conditions that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award, net of estimated forfeitures, provided that the cumulative amount of compensation cost recognized at any date at least equals the portion of the grant-date value of such award that is vested at that date. Forfeiture rates are estimated based on historical and future expectations of employee turnover rates. |
Operating leases | (o) Operating leases Leases where substantially all the rewards and risks of ownership of assets remain with the lessor are accounted for as operating leases. Rentals applicable to such operating leases are recognized on a straight-line basis over the lease term. Certain of the operating lease agreements contain rent holidays. Rent holidays are considered in determining the straight-line rent expense to be recorded over the lease term. |
Repurchase agreements | (p) Repurchase agreements Financial assets sold under agreements to repurchase do not constitute a sale of the underlying financial assets for accounting purposes and are treated as collateralized financing transactions. Financial assets sold under agreements to repurchase are recorded at the amount of cash received plus accrued interest. Interest paid on agreements to repurchase is recorded in interest expense at the contractually specified rate. |
Commitments and contingencies | (q) Commitments and contingencies Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. |
Fair value measurements | (r) Fair value measurements The Group uses valuation approaches that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Group determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels in accordance with ASU 2011-04 (see Note 7 to the consolidated financial statements): • Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date. • Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. • Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date. The level in the fair value hierarchy within which a fair value measurement in its entirety falls is based on the lowest level input that is significant to the fair value measurement in its entirety. In situations where there is little, if any, market activity for the asset or liability at the measurement date, the fair value measurement reflects management’s own judgments about the assumptions that market participants would use in pricing the asset or liability. Those judgments are developed by management based on the best information available in the circumstances. |
Earnings per share | (s) Earnings per share Basic earnings per share is computed by dividing net income attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per share is calculated by dividing net income attributable to ordinary shareholders by the weighted average number of ordinary and dilutive ordinary equivalent shares outstanding during the period. Ordinary equivalent shares are not included in the denominator of the diluted earnings per share calculation when inclusion of such shares would be anti-dilutive. For purposes of calculating basic earnings per share for the years ended December 31, 2017 and 2018, the weighted average number of shares used in the calculation has been retroactively adjusted to reflect the incorporation of the Company and the Reorganization (see Note 1), as if these events had occurred at the beginning of the earliest period presented and these shares had been outstanding for all periods. |
Segment reporting | (t) Segment reporting The Group uses the management approach in determining its operating segments. The management approach considers the internal reporting used by the Group’s chief operating decision maker for making decisions about the allocation of resources to and the assessment of the performance of the segments of the Group, therefore management has determined that the Group has one operating segment. All of the Group’s operations and customers are located in the PRC. Consequently, no geographic information is presented. |
Recently adopted accounting standards | (u) Recently adopted accounting standards ASU 2014-09, Revenue from Contracts with Customers (Topic 606). The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity is expected to be entitled for those goods or services. ASU 2014-09 defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under existing U.S. GAAP, including: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when (or as) the entity satisfies a performance obligation. Companies are permitted to adopt the standard using a retrospective transition method (i.e., restate all prior periods presented) or a cumulative effect method (i.e., recognize the cumulative effect of initially applying the guidance at the date of initial application with no restatement of prior periods). The Group adopted ASU 2014-09 and applied the cumulative effect method for its initial application since the first quarter of 2018 but there was no impact to retained earnings as a result of the adoption of the new standard. Because there is no change to the timing and pattern of revenue recognition, there are no material changes to the Group’s processes and internal controls. There are two reasons ASU 2014-09 did not have an impact to the Group. Firstly, over 99% of revenues in 2018 and 2017 are interest income earned on loans or deposits with banks, all of which are unaffected as they are outside the scope of ASU 2014-09. Secondly, the Group's non-interest income revenue stream such as mortgage agency service revenue are largely based on transactional activity, is within the scope of ASU 2014-09. However, only one percent of revenues in 2018 and 2017 are non-interest income revenue and the Group does not typically enter into long term mortgage agency service contracts with customers. Therefore, the Group does not experience significant contract balances. All of the Group’s revenue from contracts with customers in the scope of ASC 606 is recognized within Non-Interest Income. ASU 2014-09 requires disclosure of sufficient information to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. A description of the Group’s revenue streams accounted for under ASU 2014-09 as well as an explanation of why they are not impacted are as follows: Mortgage agency service revenue The Group earns fees from providing mortgage agency services to borrowers applying for loan from banks. Mortgage agency service fee is often received immediately or shortly after establishing contracts with customers. These kind of revenue are recognized at the time the transaction is executed as that is the point in time the Group fulfills the customer’s request. ASU 2016-01 Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 changes the accounting for certain equity securities to record at fair value with unrealized gains or losses reflected in earnings, as well as improve the disclosures of equity securities and the fair value of financial instruments. ASU 2016-01 also requires that for purposes of disclosing the fair value of financial instruments recorded at amortized cost, including loans and long-term debt, the valuation methodology is based on an exit price notion. The Group adopted ASU 2016-01 in January 1, 2018 with no material impact on our consolidated financial statements and related disclosures. No transition adjustment was recorded for investments changed to the measurement alternative, which was applied prospectively. The Group’s investments in nonmarketable equity securities, which are private equity securities, previously accounted for under the cost method of accounting are now accounted for using the measurement alternative. The measurement alternative is similar to the cost method of accounting, except the carrying value is adjusted through earnings for impairment, if any, and changes in observable and orderly transactions in the same or similar investment. In connection with our adoption of ASU 2016-01, the caption which the nonmarketable equity securities are accounted for is modified from other assets – cost method investments to other assets – equity securities in Note 11(i). In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. Restricted cash represents that funds in the consolidated structure funds of the Group established by the institutional trust partners through segregated bank accounts, including structure funds that are partially funded by our own capital. Such restricted cash is not available to fund the general liquidity needs of the Group. This ASU is effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Group elected to adopt ASU 2016-18 as of January 1, 2018. |
Recently issued accounting standards | (v) Recently issued accounting standards In February 2016, the FASB established Topic 842, Leases, by issuing Accounting Standards Update (ASU) No. 2016-02, which requires lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. Topic 842 was subsequently amended by ASU No. 2018-01, Land Easement Practical Expedient for Transition to Topic 842; ASU No. 2018-10, Codification Improvements to Topic 842, Leases; and ASU No. 2018-11, Targeted Improvements. The new standard establishes a right-of-use model (ROU) that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. The new standard is effective for us on January 1, 2019, with early adoption permitted. The Group expect to adopt the new standard on its effective date. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. If an entity chooses the second option, the transition requirements for existing leases also apply to leases entered into between the date of initial application and the effective date. The entity must also recast its comparative period financial statements and provide the disclosures required by the new standard for the comparative periods. The Group expect to adopt the new standard on January 1, 2019 and use the effective date as our date of initial application. Consequently, financial information will not be new standard will not be provided for dates and periods before January 1, 2019. The new standard provides a number of optional practical expedients in transition. The Group expect to elect the ‘package of practical expedients’, which permits us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. The Group do not expect to elect the use-of-hindsight or the practical expedient pertaining to land easements; the latter not being applicable to us. The Group expect that this standard will have a material effect on our financial statements. While the Group continue to assess all of the effects of adoption, the Group currently believe the most significant effects relate to the recognition of new ROU assets and lease liabilities on our balance sheet for the Group’s office operating leases. The Group do not expect a significant change in our leasing activities between now and adoption. On adoption, the Group currently expect to recognize additional operating liabilities of approximately RMB120,958,574, with corresponding ROU assets of the same amount based on the present value of the remaining minimum rental payments under current leasing standards for existing operating leases. The new standard also provides practical expedients for an entity’s ongoing accounting. The Group currently expect to elect the short-term lease recognition exemption for all leases that qualify. This means, for those leases that qualify, the Group will not recognize ROU assets or lease liabilities, and this includes not recognizing ROU assets or lease liabilities for existing short-term leases of those assets in transition. In June 2016, the FASB amended guidance related to impairment of financial instruments as part of ASU 2016-13 Financial Instruments-Credit Losses (Topic 326). The guidance replaces the incurred loss impairment methodology with an expected credit loss model for which a Group recognizes an allowance based on the estimate of expected credit loss. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. For public companies, the update is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. The Group currently uses roll rate-based model and does not plan to early adopt this standard, but is working through implementation. In that regard, the Group has formed a cross-functional working group, under the direction of the risk management department, has evaluated data sources and made process updates to capture additional relevant data, and has identified a service provider to perform the calculation. The working group is comprised of individuals from various functional areas including credit, risk management, finance and information technology. The implementation plan includes, but is not limited to, an assessment of processes, portfolio segmentation, model development, system requirements and the identification of data and resource needs. The Group are currently evaluating various loss estimation models. While the Group currently cannot reasonably estimate the impact of adopting this standard, the Group expect the impact will be influenced by the composition, characteristics and quality of loan, as well as the general economic conditions and forecasts at the adoption date. In February 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) -Disclosure Framework (Topic 842), which modify the disclosure requirements on fair value measurement. The amendments improve the effectiveness of disclosures in the notes to financial statements modify the disclosure requirements on fair value measurements in Topic 820. This ASU requires disclosure of the changes in unrealized gains or losses included in OCI for Level 3 assets or liabilities held at the end of the period and the range and weighted-average of the significant unobservable inputs used in determining the fair value of Level 3 assets and liabilities. The amendments also removes the requirement to disclose the transfers between Level 1 and Level 2 of the fair value hierarchy, timing of transfers between levels, and the valuation process for determining Level 3 fair value measurements. The amendments in this update are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The Group is currently evaluating the impact of the pending adoption on its consolidated financial statements. |
DESCRIPTION OF BUSINESS, ORGA_2
DESCRIPTION OF BUSINESS, ORGANIZATION, AND BASIS OF PRESENTATION (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Description Of Business Organization And Basis Of Presentation [Abstract] | |
Schedule of effect of the adjustments to the previously issued consolidated statements of cash flows | RMB in millions For the year ended December 31, 2016 For the year ended December 31, 2017 (as reported) (adjusted) (revised) (as reported) (adjusted) (revised) Cash flows from operating activities: Loans principal, interest and financing service fee receivables (i)(ii) (5,047 ) 5,047 - (9,309 ) 9,309 - Changes in other operating assets (ii)(iii) - (62 ) (62 ) 8 (29 ) (21 ) Changes in other operating liabilities (iv) - - - - (41 ) (41 ) Net cash (used in)/provided by operating activities (4,605 ) 4,985 380 (7,952 ) 9,239 1,287 Cash flows from investing activities: Loans originated, net of principal collected (i) - (4,985 ) (4,985 ) - (9,288 ) (9,288 ) Proceeds from sales of available-for-sale investments, and cash received from disposal of cost method investments (iii) 413 - 413 17 8 25 Net cash provided by/(used in) investing activities 285 (4,985 ) (4,700 ) (304 ) (9,280 ) (9,584 ) Cash flows from financing activities: Payments to related parties (iv) - - - (41 ) 41 - Net cash provided by financing activities 4,291 - 4,291 9,215 41 9,256 |
Schedule of investment in significant subsidiaries | Name of company Place and establishment Registered capital Issued and fully paid up capital Percentage of Principal Direct Indirect Sincere Fame International Limited 诚名国际有限公司 British Virgin Islands USD1,230,434.04 USD1,230,434.04 100 % - Investment Holding China Financial Services Group Limited 泛华金融服务集团 有限公司 Hong Kong HKD100,000,000 HKD100,000,000 - 100 % Investment Holding Fanhua Chuang Li Information Technology (Shenzhen) Co., Ltd. 泛华创利信息技术 ( 深圳 有限公司 the PRC HKD400,000,000 HKD400,000,000 - 100 % Investment Holding Shenzhen Fanhua United Investment Group Co., Ltd. 深圳泛华联合投资集团 有限公司 the PRC RMB250,000,000 RMB250,000,000 - 100 % Investment Holding Guangzhou Anyu Mortgage Consulting Co., Ltd. 广州安宇按揭咨询 有限公司 the PRC RMB2,220,000 RMB2,220,000 - 100 % Micro credit Zhengzhou Lirui Enterprise Management Advisory Co., Ltd. 郑州利瑞企业管理咨询 有限公司 the PRC RMB500,000 RMB500,000 - 100 % Financial Chongqing Fengjie Financial Advisory Co., Ltd. 重庆丰捷财务咨询 有限公司 the PRC RMB500,000 RMB500,000 - 100 % Financial consultancy Guangzhou Chengze Information Technology Co., Ltd. 广州诚泽信息科技 有限公司 the PRC RMB3,000,000 RMB3,000,000 - 100 % Software development and maintenance Name of company Place and establishment Registered capital Issued and fully paid up capital Percentage of Principal Direct Indirect Chongqing Liangjiang New Area Fanhua Micro-credit Co., Ltd. 重庆市两江新区泛华 小额贷款有限公司 the PRC USD30,000,000 USD30,000,000 - 100 % Micro credit Shenzhen Fanhua Micro-credit Co., Ltd. 深圳泛华小额贷款 有限公司 the PRC RMB300,000,000 RMB300,000,000 - 100 % Micro credit Shenzhen Fanhua Fund Management Services the PRC RMB5,000,000 RMB5,000,000 - 100 % Company register service Guangzhou Heze Information Technology Co., Ltd. the PRC RMB3,000,000 RMB3,000,000 - 100 % Software development and maintenance Beijing Lianxin Chuanghui Information Technology Co., Ltd. the PRC HKD10,000,000 HKD10,000,000 - 100 % Software development and maintenance Shenzhen Fanlian Investment Co., Ltd. the PRC RMB30,000,000 RMB30,000,000 - 100 % Investment Holding Fanhua Financial Leasing (Shenzhen) Co., Ltd. 泛华融资租赁 ( 深圳 有限公司 the PRC USD10,000,000 USD10,000,000 - 100 % Financial leasing Shenzhen Fanhua Chengyu Finance Service Co., Ltd. 深圳泛华诚誉金融配套 服务有限公司 the PRC RMB10,000,000 RMB10,000,000 - 100 % Labour outsourcing services Hangzhou Shenzhen Fanlian Investment Co., Ltd. 杭州深泛联投资管理 有限公司 the PRC RMB1,000,000 - - 100 % Asset Management Beijing Fanhua Qilin Capital Management Co., Ltd. 北京泛华麒麟资本管理 有限公司 the PRC RMB100,000,000 RMB10,000,000 - 96 % Asset Management Name of company Place and establishment Registered capital Issued and fully paid up capital Percentage of Principal Direct Indirect Shijiazhuang Fanhua Financial Advisory Co., Ltd. 石家庄泛华财务咨询 有限公司 the PRC RMB2,000,000 - - 100 % Financial Consultancy Taizhou Fanhua Financial Advisory Co., Ltd. 泰州泛华财务咨询服务 有限公司 the PRC RMB500,000 - - 100 % Financial Consultancy Xuzhou Shenfanlian Enterprise Management Co., Ltd. 徐州深泛联企业管理 有限公司 the PRC RMB10,000,000 - - 100 % Enterprise Management Zhenjiang Fanhua Business Service Advisory Co., Ltd. 镇江泛华商务服务咨询 有限公司 the PRC RMB500,000 - - 100 % Business Nantong Shenfanlian Enterprise Management Co., Ltd. 南通深泛联企业管理 有限公司 the PRC RMB5,000,000 - - 100 % Enterprise Management Jiaxing Fanhua Enterprise Management Advisory Co., Ltd. 嘉兴泛华企业管理咨询 有限公司 the PRC RMB500,000 - - 100 % Enterprise Management Baoding Fanjie Financial Advisory Co., Ltd. the PRC RMB500,000 - - 100 % Financial Consultancy Shenzhen Fancheng the PRC RMB36,210,000 RMB36,210,000 - 100 % Enterprise Management Fanxiaoxuan Cultural the PRC RMB1,000,000 - - 100 % Enterprise Management |
Schedule of investments in the consolidated VIEs by the group | Name of structure funds Place and establishment Principal activities Jinghua Structure Fund 5 菁华5号信托计划 the PRC December 19, 2014 Micro credit Jinghua Structure Fund 6 菁华6号信托计划 the PRC September 9, 2014 Micro credit Bohai Trust Shenfanlian Micro Finance Structure Fund 渤海信托深泛联小微金融集合资金信托计划 the PRC September 14, 2016 Micro credit Bohai Huihe SME Structure Fund 渤海汇和中小微企业经营贷集合资金信托计划 the PRC September 29, 2017 Micro credit Zhongyuan Wealth Anhui Structure Fund 1 中原财富-安惠1期 the PRC January 20, 2017 Micro credit Zhongyuan Wealth Anhui Structure Fund 2 中原财富-安惠2期 the PRC August 18, 2017 Micro credit Beijing Fanhua Micro-credit Company Limited 北京泛华小额贷款有限公司 the PRC August 10, 2012 Micro credit and mortgage agency services No.27 Jinghua Structure Fund 菁华27号信托计划 the PRC May, 18,2018 Micro credit No.29 Jinghua Structure Fund 菁华29号信托计划 the PRC May, 16,2018 Micro credit Yuecai Loan Structure Arrangement the PRC July 6, 2018 Micro credit Zhonghai Lanhai Structure Fund the PRC July 18, 2018 Micro credit Bairui Hengyi No.613 Structure Fund 百瑞恒益613号集合资金信托计划 the PRC July 25, 2018 Micro credit Bohai Trust No.1 Huiying Structure Fund 渤海惠盈1号集合资金信托计划 the PRC September 10, 2018 Micro credit Bohai Trust No.2 Shenzhen Fanhua United Structure Fund the PRC November 28, 2018 Micro credit Everbright No.1 Business Acceleration Structure Fund 光大助业1号集合资金信托计划 the PRC November 29, 2018 Micro credit |
Schedule of financial statements of the consolidated variable interest entity | The table sets forth the assets and liabilities of the consolidated VIEs included in the Group’s consolidated balance sheets: December 31, 2017 2018 RMB RMB Cash and cash equivalents 1,005,069,665 2,556,453,812 Loans principal, interest and financing service fee receivables 15,741,026,758 14,693,474,990 Available-for-sale investments - 270,497,995 Deferred tax assets 59,892 216,380 Other assets 134,288,627 192,135,492 Total assets 16,880,444,942 17,712,778,669 Interest-bearing borrowings 11,768,149,067 12,552,191,338 Income tax payable 923,786 956,881 Other liabilities 528,843,275 772,026,076 Total liabilities 12,297,916,128 13,325,174,295 The table sets forth the results of operations of the VIEs included in the Group’s consolidated statements of comprehensive income: 2016 2017 2018 RMB RMB RMB Revenues 1,230,596,060 3,247,097,840 4,030,796,059 Net income 316,604,468 1,074,500,910 910,293,862 The table sets forth the cash flows of the VIEs included in the Group’s consolidated statements of cash flows: 2016 2017 2018 RMB RMB RMB Net cash provided by operating activities 843,392,296 3,858,370,455 340,962,220 Net cash (used in)/provided by investing activities (5,109,269,063 ) (8,905,181,155 ) 301,170,602 Net cash provided by financing activities 4,249,962,461 5,916,858,297 909,251,326 |
DISPOSAL OF SUBSIDIARIES (Table
DISPOSAL OF SUBSIDIARIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of effect of disposal on the financial position of the Group | Aggregated carrying value as of the disposal dates RMB Cash and cash equivalents 10,532,048 Loans principal, interest and financing service fee receivables 28,221,115 Available-for-sale investments 33,616,143 Interest in equity method investee 20,450,000 Property and equipment 3,653,157 Intangible assets and goodwill 23,333 Deferred tax assets 12,779,966 Other assets 320,606,280 Accrued employee benefits (2,294,431 ) Income tax payable (14,785,506 ) Other liabilities (134,312,863 ) Net assets and liabilities 278,489,242 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets and liabilities measured at fair value on a recurring basis | December 31, 2018 Fair value Level 1 Level 2 Level 3 RMB RMB RMB RMB Wealth management products 682,252,159 - 682,252,159 - December 31, 2017 Fair value Level 1 Level 2 Level 3 RMB RMB RMB RMB Wealth management products 360,187,885 - 360,187,885 - |
LOANS PRINCIPAL, INTEREST AND_2
LOANS PRINCIPAL, INTEREST AND FINANCING SERVICE FEE RECEIVABLES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Schedule of loans principal, interest and financing service fee receivables | December 31, Note 2017 2018 RMB RMB Loans principal, interest and financing service fee receivables 16,701,504,043 15,861,324,470 Less: allowance for credit losses (a) - Individually assessed (98,736,342 ) (157,157,377 ) - Collectively assessed (341,599,744 ) (705,881,227 ) Subtotal (440,336,086 ) (863,038,604 ) Net loans principal, interest and financing service fee receivables 16,261,167,957 14,998,285,866 |
Schedule of allowance for credit losses | 2018 Allowance for Allowance for Total RMB RMB RMB As of January 1 341,599,744 98,736,342 440,336,086 Provision for credit losses 364,289,770 69,464,131 433,753,901 Charge-offs (8,287 ) (11,043,096 ) (11,051,383 ) Recoveries - - - As of December 31 705,881,227 157,157,377 863,038,604 Net loans principal, interest and financing service fee receivables 14,760,930,158 237,355,708 14,998,285,866 Recorded investment 15,466,811,385 394,513,085 15,861,324,470 2017 Allowance for loans which are collectively assessed Allowance for loans which are individually assessed Total RMB RMB RMB As of January 1 89,562,675 55,180,661 144,743,336 Provision for credit losses 252,549,185 54,203,766 306,752,951 Charge-offs (512,116 ) (10,648,085 ) (11,160,201 ) Recoveries - - - As of December 31 341,599,744 98,736,342 440,336,086 Net loans principal, interest and financing service fee receivables 16,065,757,967 195,409,990 16,261,167,957 Recorded investment 16,407,357,711 294,146,332 16,701,504,043 |
Schedule of aging of past-due loan principal and financing service fee receivables | The following tables present the aging of past-due loan principal and financing service fee receivables as of December 31, 2018. Total current 1–30 days 31–90 days 91–180 days >180 days Total loans Total non-accrual 90 days past due RMB RMB RMB RMB RMB RMB RMB RMB Loans principal, interest and financing service fee receivables 12,929,493,099 1,031,203,259 1,484,689,974 159,343,805 256,594,333 15,861,324,470 415,938,138 - The following tables present the aging of past-due loan principal and financing service fee receivables as of December 31, 2017. Total current 1–30 days past due 31–90 days past due 91–180 days past due >180 days past due Total loans Total non-accrual 90 days past due and accruing RMB RMB RMB RMB RMB RMB RMB RMB Loans principal, interest and financing service fee receivables 15,477,867,781 723,143,029 206,346,901 136,276,334 157,869,998 16,701,504,043 294,146,332 - |
Schedule of summary of Impaired loans | Recorded investment Unpaid principal Impaired Impaired Impaired Related RMB RMB RMB RMB RMB As of December 31,2018 417,625,050 415,938,138 358,477,762 57,460,376 157,157,377 As of December 31,2017 299,550,322 294,146,332 242,037,110 52,109,222 98,736,342 Year ended December 31, 2017 2018 Average recorded investment (i) Interest and fees income recognized (ii) Average recorded investment (i) Interest and fees income recognized (ii) RMB RMB RMB RMB Impaired loans 193,518,814 19,502,728 335,515,156 26,786,527 (i) Average recorded investment represents ending balance for the last four quarters and does not include the related allowance for credit losses. (ii) The interest and fees income recognized are those interest and financing service fee recognized related to impaired loans. All the amounts are recognized on cash basis. |
AVAILABLE-FOR-SALE INVESTMENTS
AVAILABLE-FOR-SALE INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Securities, Available-for-sale [Abstract] | |
Schedule of carrying amount, gross unrealized holding gains, gross unrealized holding losses, and fair value | Aggregate cost basis Total OTTI recognized in OCI Gross unrealized holding gains Gross unrealized holding (losses) Aggregate fair value RMB RMB RMB RMB RMB As of December 31, 2018: Wealth management products 680,000,000 - 2,252,159 - 682,252,159 As of December 31, 2017: Wealth management products 360,050,000 - 137,885 - 360,187,885 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | December 31, 2017 2018 RMB RMB Office and other equipment 19,997,272 23,774,820 Leasehold improvements 21,147,511 25,062,449 Motor vehicles 1,717,658 1,655,768 Less: accumulated depreciation (20,394,541 ) (31,326,808 ) Total 22,467,900 19,166,229 |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets and goodwill | December 31, Note 2017 2018 RMB RMB Intangible assets (a) 3,342,463 4,176,244 |
Schedule of intangible assets | December 31,2017 December 31,2018 Gross carrying Accumulated Net carrying Gross carrying Accumulated Net carrying value amortization value value amortization value RMB RMB RMB RMB RMB RMB Amortized intangible assets: Software 7,547,440 (7,174,977 ) 372,463 8,694,496 (7,488,252 ) 1,206,244 Cooperation agreement 5,030,000 (5,030,000 ) - 5,030,000 (5,030,000 ) - Total amortized intangible assets 12,577,440 (12,204,977 ) 372,463 13,724,496 (12,518,252 ) 1,206,244 Unamortized intangible assets: Trademarks 2,970,000 2,970,000 |
Schedule of amortization expense for current year and future periods | Software RMB Year ended December 31, 2018 (actual) 313,274 Estimate for year ended December 31, 2019 515,055 2020 489,022 2021 202,167 2022 - 2023 - |
OTHER ASSETS (Tables)
OTHER ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Other Assets [Abstract] | |
Schedule of other assets | Note December 31, 2017 2018 RMB RMB Equity securities (i) 40,010,000 40,010,000 Less: impairment losses - - Receivable from private equity funds - Principal - 21,350,000 - Interest - 4,523,205 Receivables from disposal of subsidiaries 29,658,807 - Prepayments 13,053,454 6,741,881 Receivables for realization of collaterals 10,504,570 7,164,458 Amounts due from employees (ii) 10,027,597 10,126,228 Commission and fee receivables (iii) 6,686,148 2,323,085 Less: impairment losses (2,323,085 ) (2,323,085 ) Other receivables 7,866,237 3,429,580 Total 115,483,728 93,345,352 |
INTEREST-BEARING BORROWINGS (Ta
INTEREST-BEARING BORROWINGS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of borrowings under agreements to repurchase | Fixed interest rate Term December 31, 2017 2018 Note RMB RMB Repurchase agreements Funds obtained from Internet funding platforms 9.7% to 14 % 3 to 12 months 1,405,217,000 - Private investment funds 10% to 16 % Less than 1 year 2,042,700,000 2,540,140,000 Asset management company 14 % Less than 1 year - 10,000,000 Financial institution (i) 12.1 % Within 4 years - 1,625,676,189 Interest payable Internet funding platforms 50,757,320 - Private investment funds 13,440,641 20,046,580 Asset management company - 713,425 Financial institution (i) - 17,323,834 Total repurchase agreements 3,512,114,961 4,213,900,028 |
Schedule of underlying collateral types of the gross obligations under repurchase agreements | December 31, 2017 2018 RMB RMB Underlying collateral types of gross obligations Repurchase agreements: Rights to earnings in the Group's subordinate tranches of consolidated VIEs 3,265,076,611 2,381,636,580 Rights to earnings in loans principal, interest and financing service fee receivables 247,038,350 189,263,425 Loans principal, interest and financing service fee receivables - 1,643,000,023 Total repurchase agreements 3,512,114,961 4,213,900,028 |
Schedule of contractual maturities of the gross obligations under repurchase agreements | Overnight Up to30 days 30 to 90 days Greater than 90 days Total gross obligations RMB RMB RMB RMB RMB Repurchase agreements As of December 31,2018 - 344,050,001 569,088,175 3,300,761,852 4,213,900,028 As of December 31,2017 - 114,331,541 366,877,171 3,030,906,249 3,512,114,961 |
Schedule of other borrowings | Other borrowings Note Fixed interest rate per annum Term December 31, 2017 2018 Short-term: RMB RMB Investors of consolidated VIEs (i) 7% to 13 % Less than 1 year 8,123,145,600 4,237,790,000 Investors of internet funding platforms (ii) 9.7% to 14 % 3 to 12 months 184,157,982 - Asset management partnerships (iii) 11% to 15 % Less than 1 year 75,000,000 78,950,000 Trust company (iv) 10.89 % Less than 1 year 110,000,000 - Senior tranche of asset management product which invests in the Group's loans portfolio (v) 8.5 % Less than 1 year 25,992,786 - Investors of wealth management product which invests in the Group's loans portfolio (vi) 11 % Less than 1 year - 10,423,230 Micro-credit companies (viii) 13.5 % Less than 1 year - 30,000,000 Long-term: Investors of consolidated VIEs (i) 11.8%-12.7 % Within 5 years 3,380,980,000 6,548,437,241 Senior tranche of trust plan which invests in the Group's loans portfolio (vii) 10.24 % Within 4 years 131,263,590 82,718,203 Interest payable to Investors of consolidated VIEs (i) 147,849,661 121,127,920 Investors of internet funding platforms (ii) 2,148,517 - Asset management partnerships (iii) 9,860,151 1,275,806 Trust company (iv) 4,854,255 - Senior tranche of asset management product which invests in the Group's loans portfolio (v) 117,284 - Senior tranche of trust plan which invests in the Group's loans portfolio (vii) 451,391 - Micro-credit companies (viii) - 153,611 Total 12,195,821,217 11,110,876,011 (i) The financial liabilities arising from the VIEs with underlying investments in loans to customers are classified as payables in these consolidated financial statements. It is because the Group has an obligation to pay senior tranches holders upon maturity dates of the structured entities based on the related terms of those consolidated structured funds. (ii) The borrowings from investor of internet funding platforms are funds raised from investors like a company named Shenzhen Taotaojin, bearing interest rate from 9.7% to 14% per year. As of December 31, 2018, the borrowings have been fully paid. (iii) As of December 31, 2018, the borrowings from asset management partnerships are from (1) Zhuhai Longhua Qifu NO.1 Fund Partnership (Limited Partnership) with principal RMB50 million, (2) Ningbo Longhua Zhihe Investment Management Partnership (Limited Partnership) with principal RMB20 million, (3) Jilin Northeast Asia Innovation Financial Assets Trading Center Co., Ltd. with principal RMB8.95 million, bearing interest at 11%, 11.47% and 15% per year, respectively. (iv) The borrowings from trust company is from Shanxi Trust Limited Company, bearing interest at 10.89% per year. As of December 31, 2018, the borrowings has been fully paid. (v) The borrowings from senior tranche of asset management product which invests in the Group's loans portfolio are the capitals from senior tranche holders of Zhaoqian Jinjiao Fanhua Asset Management Product, bearing interest at 8.5% per year. As of December 31, 2018, the borrowings has been fully paid. (vi) The borrowings from Investors of wealth management product which invests in the Group's loans portfolio are the capitals from A-class purchasers of Lianda Baoli Co., Ltd., with principal RMB10.42 million on December 31, 2018, bearing interest at 11% per year. (vii) As of December 31, 2018, the borrowings from senior tranche of trust plan which invests in the Group's loans portfolio are the capitals from senior tranche holders of No.1 Wukuang Trust Yangguang Fanhua Plan with principal RMB82.72 million, bearing interest at 10.24% per year. (viii) The borrowings are from Guangdong Province Yueke Technology Micro-credit Co., Ltd. with principal RMB10 million and RMB20 million. The interest-bearing borrowings bear interest at 13.5% and 13% per year, respectively. |
Schedule of aggregate annual maturities of long-term borrowing obligations | December 31,2018 2019 2020 2021 2022 2023 Thereafter Total RMB RMB RMB RMB RMB RMB RMB Investors of consolidated VIEs - 5,914,569,684 236,909,800 - 291,705,438 105,252,319 6,548,437,241 Senior tranche of trust plan which invests in the Group's loans portfolio 43,782,203 31,416,000 7,520,000 - - - 82,718,203 Total 43,782,203 5,945,985,684 244,429,800 - 291,705,438 105,252,319 6,631,155,444 |
Schedule of carrying amounts of pledged assets | December 31, 2017 2018 RMB RMB Rights to earnings in the Group's subordinate tranches of consolidated VIEs 4,173,931,373 3,474,391,373 Rights to earnings in loans principal, interest and financing service fee receivables 493,413,547 554,154,772 Loans principal, interest and financing service fee receivables - 1,539,973,217 Total 4,667,344,920 5,568,519,362 |
OTHER LIABILITIES (Tables)
OTHER LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of other liabilities | Note December 31, 2017 2018 RMB RMB Customer pledged deposits (i) 106,006,039 77,726,077 Other tax payables (ii) 75,915,052 89,586,329 Receipt in advance (iii) 6,979,476 44,083,940 Settlement and clearing accounts (iv) - 10,112,678 Amounts due to third parties 7,004,153 10,952,518 Expenses payable to suppliers 10,611,883 8,868,056 Others 17,220,665 10,156,157 Total 223,737,268 251,485,755 (i) Customer pledged deposits mainly consist of the deposits collected from certain customers to reduce the risk of failure to make payments on schedule. (ii) Other tax payables mainly represents value-added tax payables. (iii) Receipt in advance consist of advance for interest and financing service fees on loans and down payments by loan transferees. Down payments are newly increase in 2018, amounting to RMB35,493,777. (iv) The Group transferred loans to third party investors and recorded these transactions as sales in Note 6(c). After the transfer, the contract terms related to payment proceeds of the loans remain the same: the Group collects payments of loans and then disburses the proceeds from the relevant loans to third-party transferees. (v) Other liabilities are expected to be settled or recognized as income within one year or are repayable on demand. |
RETAINED EARNINGS (Tables)
RETAINED EARNINGS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Retained Earnings Note Disclosure [Abstract] | |
Schedule of retained earnings | Note December 31, 2017 2018 RMB RMB PRC statutory reserves (i) 258,654,052 258,654,052 PRC surplus reserves (ii) 63,124,291 122,148,068 Unreserved retained earnings 944,814,653 1,746,699,587 Total 1,266,592,996 2,127,501,707 (i) With effect from July 1, 2012, pursuant to the “Administrative Measures on Accrual of Provisions by Financial Institutions” issued by the MOF in March 2012, the Group is required, in principle, to set aside a general reserve not lower than 1.5% of the ending balance of its gross risk-bearing assets. (ii) In accordance with the Company’s PRC subsidiaries’ articles of associate, the subsidiaries are required to appropriate 10% of their net incomes, upon approval by board of directors. |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME/ (LOSSES) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accumulated Other Comprehensive Income/(Losses) | |
Schedule of accumulated other comprehensive income / (losses) | Unrealized gain on available-for-sale investments Foreign Before tax Tax (expenses) Net-of-tax RMB RMB RMB RMB Balance as of January 1, 2018 (4,572,858 ) 137,885 (34,471 ) 103,414 Other comprehensive loss, net (1,682,779 ) 2,114,274 (528,569 ) 1,585,705 Balance as of December 31, 2018 (6,255,637 ) 2,252,159 (563,040 ) 1,689,119 Balance as of January 1, 2017 (4,374,064 ) 3,606,359 (901,590 ) 2,704,769 Other comprehensive loss, net (198,794 ) (3,468,474 ) 867,119 (2,601,355 ) Balance as of December 31, 2017 (4,572,858 ) 137,885 (34,471 ) 103,414 |
OTHER GAINS_(LOSSES), NET (Tabl
OTHER GAINS/(LOSSES), NET (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Other gains/(losses), net | |
Schedule of other gains/(losses), net | Years ended December 31, Note 2016 2017 2018 RMB RMB RMB Mortgage agency service revenue (i) 12,373,044 8,395,774 4,466,608 Asset management revenue (ii) 9,628,621 1,316,186 - Net gain on disposal of subsidiaries - 6,060,758 - Labour outsourcing services income (iii) 12,035,445 7,857,461 - Foreign exchange gain/(loss) 2,717,820 (2,274,438 ) 1,836,029 Register services income 238,500 183,010 - Net loss on disposal of property and equipment (61,085 ) (261,875 ) (946,244 ) Net loss on sale of loans - - (16,697,259 ) Others (670,412 ) 2,702,734 (3,242,074 ) Total 36,261,933 23,979,610 (14,582,940 ) (i) The Group earns fees from providing mortgage agency services to borrowers applying for a bank loan. This kind of revenue is recognized at the time when loan is granted as that is the point of time the Group fulfils the customer’s request, and is then recognized on an accrual basis in accordance with the terms of the relevant agreements. Mortgage agency service revenue consists of revenue earned from housing mortgage agency service and cars mortgage agency service, which accounted for 59.73% and 40.27% of mortgage agency service revenue in the year of 2018, respectively. (ii) The Group receives asset management revenue from providing asset management services for investors. The asset management revenue is calculated and accrued on a daily basis based on the daily net asset value of the asset management products under management. The asset management business has been disposed of in 2017. (iii) The Group receives labour outsourcing services income from providing labour outsourcing services to clients by one of the subsidiaries of the Group. Labour outsourcing services income are recognized on an accrual basis in accordance with the terms of the relevant agreements. As the subsidiary was disposed of in 2017, there would be no such income in the future. |
OTHER EXPENSES (Tables)
OTHER EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Other Expenses [Abstract] | |
Schedule of other expenses | Years ended December 31, 2016 2017 2018 RMB RMB RMB Consulting fees 5,736,437 9,282,890 38,031,501 Advertising and promotion expenses 16,383,290 15,028,164 15,323,838 Office expenses 14,453,830 18,769,477 14,425,608 Entertainment and travelling expenses 11,767,688 14,506,006 14,237,820 Depreciation and amortization 6,595,476 10,804,855 13,299,246 Communication expenses 2,530,162 2,598,250 2,549,164 Research and development expenses 8,507,265 4,794,998 1,419,878 Asset management expenses 3,887,977 - - Provision for cost method investment 1,270,001 - - Others 4,675,782 6,409,916 14,268,602 Total 75,807,908 82,194,556 113,555,657 |
INCOME TAX EXPENSE (Tables)
INCOME TAX EXPENSE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of income tax expense | Years ended December 31, 2016 2017 2018 RMB RMB RMB Current tax expense 86,073,560 333,883,691 401,913,951 Deferred tax benefit (33,470,137 ) (57,888,823 ) (105,085,476 ) Total income tax expense 52,603,423 275,994,868 296,828,475 |
Schedule of components of the deferred tax assets and liabilities | Years ended December 31, 2017 2018 RMB RMB Deferred tax assets: Allowance for loans principal 105,191,243 205,058,644 Allowance for interest and financing fee receivables 5,473,550 11,281,778 Allowance for available-for-sale investments - - Net operating loss carry-forwards 12,610,881 5,743,768 Other deferred tax assets 1,865,154 1,275,001 Subtotal of deferred tax assets 125,140,828 223,359,191 Valuation allowance (12,610,881 ) (5,743,768 ) Total deferred tax assets 112,529,947 217,615,423 Deferred tax liabilities: Intangible assets (742,500 ) (742,500 ) Available-for-sale investments (34,471 ) (563,040 ) Total deferred tax liabilities (776,971 ) (1,305,540 ) |
Schedule of movement of valuation allowance | 2017 2018 RMB RMB At the beginning of year 21,743,157 12,610,881 Current year additions 8,512,244 1,572,672 Current year reversals (2,433,708 ) (8,391,178 ) Current year charge-offs (25,800 ) (48,607 ) Current year disposal (15,185,012 ) - At the end of year 12,610,881 5,743,768 |
Schedule of income before income tax | Years ended December 31, 2016 2017 2018 RMB RMB RMB Non-PRC entities (564,877 ) (8,903,856 ) 79,256 PRC entities 288,610,139 817,571,481 1,157,657,930 Total 288,045,262 808,667,625 1,157,737,186 |
Schedule of reconciliation of statutory income tax rate to the effective income tax rate | Years ended December 31, 2016 2017 2018 PRC statutory income tax rate 25.00 % 25.00 % 25.00 % (Decrease)/Increase in effective income tax rate resulting from: Effect of tax holiday (13.16 )% (0.51 )% 0.00 % Effect of tax-free income (8.10 )% (4.00 )% (0.03 )% Effect of disposal of subsidiaries 0.00 % 6.53 % 0.00 % Effect of Non-deductible share option expense 0.00 % 5.65 % 0.86 % Effect of zero tax rate in foreign countries (0.02 )% 0.27 % (0.00 )% Effect of transfer pricing 6.88 % 0.32 % 0.00 % Changes in valuation allowance 5.73 % 0.75 % (0.59 )% Others 1.93 % 0.11 % 0.42 % Effective income tax rate 18.26 % 34.12 % 25.66 % |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of computation of basic and diluted earnings per share | Years ended December 31, 2016 2017 2018 RMB RMB RMB Net income 235,441,839 532,672,757 860,908,711 Basic weighted average number of common shares outstanding 1,230,434,041 1,230,434,041 1,251,608,224 Effect of dilutive share options - 100,975,533 137,727,545 Dilutive weighted average number of ordinary shares 1,230,434,041 1,331,409,574 1,389,335,769 Basic earnings per share 0.19 0.43 0.69 Diluted earnings per share 0.19 0.40 0.62 |
SHARE-BASED COMPENSATION EXPE_2
SHARE-BASED COMPENSATION EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of estimated fair value of the options on the respective grant dates using a binomial option pricing model | Share awards granted on November 1, 2009 Share awards granted on January 3, 2017 Expected volatility 71 % 40 % Expected dividends - - Risk-free interest rate 3.50 % 3.10 % Expected term (in years) 5 5 Expected life (in years) 7.17 6 |
Schedule of summary of share option activity | Number of Weighted exercise price Weighted RMB RMB Balance, December 31, 2016 - - - Granted 187,933,730 - 1.27 Exercised - - - Surrendered - - - Balance, December 31, 2017 187,933,730 - 1.27 Exercisable, December 31, 2017 112,760,238 - 1.27 Expected to vest, December 31, 2017 75,173,492 - 1.27 Balance, December 31, 2017 187,933,730 - 1.27 Granted - - - Exercised - - - Surrendered - - - Balance, December 31, 2018 187,933,730 - 1.27 Exercisable, December 31, 2018 150,346,984 - 1.27 Expected to vest, December 31, 2018 37,586,746 - 1.27 |
Schedule of fair value of options and ordinary shares estimated at the dates of option grants | Date of options grant Options Exercise Fair value Fair value of ordinary shares November 1, 2009 25,678 RMB3,190 RMB640.10 RMB1,506 January 3, 2017 75,173,492 RMB0.50 RMB1.26 RMB1.72 January 3, 2017 112,760,238 RMB0.50 RMB1.27 RMB1.72 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum lease payments under non-cancellable operating leases | As of December 31, RMB 2019 55,912,805 2020 31,600,761 2021 17,417,081 2022 10,701,271 2023 4,601,398 Later years, through 2025 5,247,712 Total 125,481,028 |
CONDENSED FINANCIAL INFORMATI_2
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information Disclosure [Abstract] | |
Schedule of Condensed Balance Sheets | Condensed balance sheets December 31, 2018 RMB Assets Cash and cash equivalents 319,807,618 Investments in subsidiaries 392,559,403 Total assets 712,367,021 Liabilities and shareholders' equity Other operating liabilities 8,158,984 Total liabilities 8,158,984 Ordinary shares (3,800,000,000 shares authorized, 1 share with HKD0.0001 as par value and 1,371,643,240 shares with USD0.0001 as par value issued as of December 31, 2017 and December 31, 2018, respectively) 916,743 Additional paid-in capital 705,422,445 Retained earnings (5,672 ) Accumulated other comprehensive income: Foreign currency translation adjustment (2,125,479 ) Total shareholders’ equity 704,208,037 Total liabilities and shareholders' equity 712,367,021 |
Schedule of Condensed Statements of Comprehensive Income | Condensed statements of comprehensive income 2018 RMB Operating expenses Administration Expense (5,672 ) Total operating expenses (5,672 ) Income before income tax (5,672 ) Net loss (5,672 ) Other comprehensive losses Foreign currency translation adjustment (2,125,479 ) Comprehensive income (2,131,151 ) |
Schedule of Condensed Statements of Cash Flows | Condensed statements of cash flows 2018 RMB Cash flows from operating activities: Net loss (5,672 ) Other operating liabilities 7,311 Net cash provided by operating activities 1,639 Cash flows from financing activities: Proceeds from initial public offering, net of offering cost paid of RMB51,967,702 in 2018 321,930,733 Net cash provided by financing activities 321,930,733 Net increase in cash and cash equivalents 321,932,372 Cash and cash equivalents at the beginning of year - Effect of exchange rate change on cash and cash equivalents (2,124,754 ) Cash and cash equivalents at the end of year 319,807,618 |
DESCRIPTION OF BUSINESS, ORGA_3
DESCRIPTION OF BUSINESS, ORGANIZATION, AND BASIS OF PRESENTATION (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities: | |||
Changes in other operating assets | ¥ 138,548,636 | ¥ 289,327,710 | ¥ (43,271,746) |
Changes in other operating liabilities | 240,699,389 | 691,081,484 | 2,077,066 |
Net cash (used in)/provided by operating activities | 1,332,657,044 | 1,286,649,584 | 379,883,655 |
Cash flows from investing activities: | |||
Loans originated, net of principal collected | 777,832,690 | (9,288,327,415) | (4,985,137,870) |
Net cash provided by/(used in) investing activities | 641,390,344 | (9,583,892,655) | (4,700,415,345) |
Cash flows from financing activities: | |||
Repayment through related parties | (32,747,681) | ||
Net cash provided by financing activities | ¥ (2,548,924) | 9,256,740,263 | 4,291,087,461 |
Sincere Fame International Limited ("Sincere Fame") | |||
Cash flows from operating activities: | |||
Loans principal, interest and financing service fee receivables | 0 | 0 | |
Changes in other operating assets | (21,000,000) | (62,000,000) | |
Changes in other operating liabilities | (41,000,000) | 0 | |
Net cash (used in)/provided by operating activities | 1,287,000,000 | 380,000,000 | |
Cash flows from investing activities: | |||
Loans originated, net of principal collected | (9,288,000,000) | (4,985,000,000) | |
Proceeds from sales of available-for-sale investments, and cash received from disposal of cost method investments | 25,000,000 | 413,000,000 | |
Net cash provided by/(used in) investing activities | (9,584,000,000) | (4,700,000,000) | |
Cash flows from financing activities: | |||
Repayment through related parties | 0 | 0 | |
Net cash provided by financing activities | 9,256,000,000 | 4,291,000,000 | |
Sincere Fame International Limited ("Sincere Fame") | As reported | |||
Cash flows from operating activities: | |||
Loans principal, interest and financing service fee receivables | (9,309,000,000) | (5,047,000,000) | |
Changes in other operating assets | 8,000,000 | 0 | |
Changes in other operating liabilities | 0 | 0 | |
Net cash (used in)/provided by operating activities | (7,952,000,000) | (4,605,000,000) | |
Cash flows from investing activities: | |||
Loans originated, net of principal collected | 0 | 0 | |
Proceeds from sales of available-for-sale investments, and cash received from disposal of cost method investments | 17,000,000 | 413,000,000 | |
Net cash provided by/(used in) investing activities | (304,000,000) | 285,000,000 | |
Cash flows from financing activities: | |||
Repayment through related parties | (41,000,000) | 0 | |
Net cash provided by financing activities | 9,215,000,000 | 4,291,000,000 | |
Sincere Fame International Limited ("Sincere Fame") | Adjusted | |||
Cash flows from operating activities: | |||
Loans principal, interest and financing service fee receivables | 9,309,000,000 | 5,047,000,000 | |
Changes in other operating assets | (29,000,000) | (62,000,000) | |
Changes in other operating liabilities | (41,000,000) | 0 | |
Net cash (used in)/provided by operating activities | 9,239,000,000 | 4,985,000,000 | |
Cash flows from investing activities: | |||
Loans originated, net of principal collected | (9,288,000,000) | (4,985,000,000) | |
Proceeds from sales of available-for-sale investments, and cash received from disposal of cost method investments | 8,000,000 | 0 | |
Net cash provided by/(used in) investing activities | (9,280,000,000) | (4,985,000,000) | |
Cash flows from financing activities: | |||
Repayment through related parties | 41,000,000 | 0 | |
Net cash provided by financing activities | ¥ 41,000,000 | ¥ 0 |
DESCRIPTION OF BUSINESS, ORGA_4
DESCRIPTION OF BUSINESS, ORGANIZATION, AND BASIS OF PRESENTATION (Details 1) | 12 Months Ended | ||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2018HKD ($) | |
Sincere Fame International Limited ("Sincere Fame") | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | British Virgin Islands | ||
Date of incorporation/establishment | Oct. 6, 2006 | ||
Registered capital | $ | $ 1,230,434.04 | ||
Issued and fully paid up capital | $ | $ 1,230,434.04 | ||
Percentage of equity attributable to the Group - Direct | 100.00% | 100.00% | 100.00% |
Principal activities | Investment Holding | ||
China Financial Services Group Limited | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | Hong Kong | ||
Date of incorporation/establishment | Aug. 28, 2000 | ||
Registered capital | $ | $ 100,000,000 | ||
Issued and fully paid up capital | $ | $ 100,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Investment Holding | ||
Fanhua Chuang Li Information Technology (Shenzhen) Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Dec. 21, 1999 | ||
Registered capital | $ | $ 400,000,000 | ||
Issued and fully paid up capital | $ | $ 400,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Investment Holding | ||
Shenzhen Fanhua United Investment Group Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Aug. 9, 2006 | ||
Registered capital | ¥ 250,000,000 | ||
Issued and fully paid up capital | ¥ 250,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Investment Holding | ||
Guangzhou Anyu Mortgage Consulting Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Jan. 23, 2003 | ||
Registered capital | ¥ 2,220,000 | ||
Issued and fully paid up capital | ¥ 2,220,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Micro credit and mortgage agency services | ||
Zhengzhou Lirui Enterprise Management Advisory Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Dec. 17, 2009 | ||
Registered capital | ¥ 500,000 | ||
Issued and fully paid up capital | ¥ 500,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Financial consultancy | ||
Chongqing Fengjie Financial Advisory Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Jun. 13, 2010 | ||
Registered capital | ¥ 500,000 | ||
Issued and fully paid up capital | ¥ 500,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Financial consultancy | ||
Guangzhou Chengze Information Technology Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Dec. 11, 2006 | ||
Registered capital | ¥ 3,000,000 | ||
Issued and fully paid up capital | ¥ 3,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Software development and maintenance | ||
Chongqing Liangjiang New Area Fanhua Micro- credit Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Dec. 26, 2011 | ||
Registered capital | $ | $ 30,000,000 | ||
Issued and fully paid up capital | $ | $ 30,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Micro credit and mortgage agency services | ||
Shenzhen Fanhua Micro-credit Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Mar. 15, 2012 | ||
Registered capital | ¥ 300,000,000 | ||
Issued and fully paid up capital | ¥ 300,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Micro credit and mortgage agency services | ||
Shenzhen Fanhua Fund Management Services Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Jun. 8, 2012 | ||
Registered capital | ¥ 5,000,000 | ||
Issued and fully paid up capital | ¥ 5,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Company register service | ||
Guangzhou Heze Information Technology Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Sep. 16, 2010 | ||
Registered capital | ¥ 3,000,000 | ||
Issued and fully paid up capital | ¥ 3,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Software development and maintenance | ||
Beijing Lianxin Chuanghui Information Technology Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Feb. 2, 2012 | ||
Registered capital | $ | $ 10,000,000 | ||
Issued and fully paid up capital | $ | $ 10,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Software development and maintenance | ||
Shenzhen Fanlian Investment Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Nov. 26, 2012 | ||
Registered capital | ¥ 30,000,000 | ||
Issued and fully paid up capital | ¥ 30,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Investment Holding | ||
Fanhua Financial Leasing (Shenzhen) Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Sep. 4, 2012 | ||
Registered capital | $ | $ 10,000,000 | ||
Issued and fully paid up capital | $ | $ 10,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Financial leasing | ||
Shenzhen Fanhua Chengyu Finance Service Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Mar. 15, 2012 | ||
Registered capital | ¥ 10,000,000 | ||
Issued and fully paid up capital | ¥ 10,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Labour outsourcing services | ||
Hangzhou Shenzhen Fanlian Investment Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Dec. 14, 2015 | ||
Registered capital | ¥ 1,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Asset Management | ||
Beijing Fanhua Qilin Capital Management Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Dec. 26, 2016 | ||
Registered capital | ¥ 100,000,000 | ||
Issued and fully paid up capital | ¥ 10,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Asset Management | ||
Shijiazhuang Fanhua Financial Advisory Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Jul. 27, 2017 | ||
Registered capital | ¥ 2,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Financial Consultancy | ||
Taizhou Fanhua Financial Advisory Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Sep. 28, 2017 | ||
Registered capital | ¥ 500,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Financial Consultancy | ||
Xuzhou Shenfanlian Enterprise Management Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Dec. 7, 2017 | ||
Registered capital | ¥ 10,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Enterprise Management | ||
Zhenjiang Fanhua Business Service Advisory Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Oct. 16, 2017 | ||
Registered capital | ¥ 500,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Business Advisory | ||
Nantong Shenfanlian Enterprise Management Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Sep. 8, 2017 | ||
Registered capital | ¥ 5,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Enterprise Management | ||
Jiaxing Fanhua Enterprise Management Advisory Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Feb. 7, 2018 | ||
Registered capital | ¥ 500,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Enterprise Management | ||
Baoding Fanjie Financial Advisory Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Feb. 9, 2018 | ||
Registered capital | ¥ 500,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Financial Consultancy | ||
Shenzhen Fancheng Business Operation Management Partnership (Limited Partnership) | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Jun. 22, 2018 | ||
Registered capital | ¥ 36,210,000 | ||
Issued and fully paid up capital | ¥ 36,210,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Enterprise Management | ||
Fanxiaoxuan Cultural Media (Guangzhou) Co., Ltd. | |||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |||
Place of incorporation/establishment | the PRC | ||
Date of incorporation/establishment | Jul. 16, 2018 | ||
Registered capital | ¥ 1,000,000 | ||
Percentage of equity attributable to the Group - Indirect | 100.00% | 100.00% | 100.00% |
Principal activities | Enterprise Management |
DESCRIPTION OF BUSINESS, ORGA_5
DESCRIPTION OF BUSINESS, ORGANIZATION, AND BASIS OF PRESENTATION (Details 2) | 12 Months Ended |
Dec. 31, 2018 | |
Jinghua Structure Fund 5 | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | Dec. 19, 2014 |
Principal activities | Micro credit |
Jinghua Structure Fund 6 | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | Sep. 9, 2014 |
Principal activities | Micro credit |
Bohai Trust Shenfanlian Micro Finance Structure Fund | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | Sep. 14, 2016 |
Principal activities | Micro credit |
Bohai Huihe SME Structure Fund | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | Sep. 29, 2017 |
Principal activities | Micro credit |
Zhongyuan Wealth Anhui Structure Fund 1 | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | Jan. 20, 2017 |
Principal activities | Micro credit |
Zhongyuan Wealth Anhui Structure Fund 2 | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | Aug. 18, 2017 |
Principal activities | Micro credit |
Beijing Fanhua Micro-credit Company Limited | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | Aug. 10, 2012 |
Principal activities | Micro credit and mortgage agency services |
No.27 Jinghua Structure Fund | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | May 18, 2018 |
Principal activities | Micro credit |
No.29 Jinghua Structure Fund | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | May 16, 2018 |
Principal activities | Micro credit |
Yuecai Loan Structure Arrangement | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | Jul. 6, 2018 |
Principal activities | Micro credit |
Zhonghai Lanhai Structure Fund | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | Jul. 18, 2018 |
Principal activities | Micro credit |
Bairui Hengyi No.613 Structure Fund | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | Jul. 25, 2018 |
Principal activities | Micro credit |
Bohai Trust No.1 Huiying Structure Fund | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | Sep. 10, 2018 |
Principal activities | Micro credit |
Bohai Trust No.2 Shenzhen Fanhua United Structure Fund | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | Nov. 28, 2018 |
Principal activities | Micro credit |
Everbright No.1 Business Acceleration Structure Fund | |
Variable Interest Entity [Line Items] | |
Place of incorporation/establishment | the PRC |
Date of incorporation/establishment | Nov. 29, 2018 |
Principal activities | Micro credit |
DESCRIPTION OF BUSINESS, ORGA_6
DESCRIPTION OF BUSINESS, ORGANIZATION, AND BASIS OF PRESENTATION (Details 3) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Variable Interest Entity [Line Items] | ||||
Cash and cash equivalents | ¥ 3,161,657,934 | ¥ 1,190,360,385 | ¥ 233,138,588 | ¥ 260,081,796 |
Available-for-sale investments | 682,252,159 | 360,187,885 | ||
Deferred tax assets | 217,615,423 | 112,529,947 | ||
Other assets | 93,345,352 | 115,483,728 | ||
Income tax payable | 689,415,410 | 383,338,483 | ||
Other liabilities | 251,485,755 | 223,737,268 | ||
VIEs (primary beneficiary) | ||||
Variable Interest Entity [Line Items] | ||||
Cash and cash equivalents | 2,556,453,812 | 1,005,069,665 | ||
Loans principal, interest and financing service fee receivables | 14,693,474,990 | 15,741,026,758 | ||
Available-for-sale investments | 270,497,995 | |||
Deferred tax assets | 216,380 | 59,892 | ||
Other assets | 192,135,492 | 134,288,627 | ||
Total assets | 17,712,778,669 | 16,880,444,942 | ||
Interest-bearing borrowings | 12,552,191,338 | 11,768,149,067 | ||
Income tax payable | 956,881 | 923,786 | ||
Other liabilities | 772,026,076 | 528,843,275 | ||
Total liabilities | ¥ 13,325,174,295 | ¥ 12,297,916,128 |
DESCRIPTION OF BUSINESS, ORGA_7
DESCRIPTION OF BUSINESS, ORGANIZATION, AND BASIS OF PRESENTATION (Details 4) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Variable Interest Entity [Line Items] | |||
Net income | ¥ 860,908,711 | ¥ 532,672,757 | ¥ 235,441,839 |
VIEs (primary beneficiary) | |||
Variable Interest Entity [Line Items] | |||
Revenues | 4,030,796,059 | 3,247,097,840 | 1,230,596,060 |
Net income | ¥ 910,293,862 | ¥ 1,074,500,910 | ¥ 316,604,468 |
DESCRIPTION OF BUSINESS, ORGA_8
DESCRIPTION OF BUSINESS, ORGANIZATION, AND BASIS OF PRESENTATION (Details 5) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Variable Interest Entity [Line Items] | |||
Net cash provided by operating activities | ¥ 1,332,657,044 | ¥ 1,286,649,584 | ¥ 379,883,655 |
Net cash provided by/(used in) investing activities | 641,390,344 | (9,583,892,655) | (4,700,415,345) |
Net cash provided by financing activities | (2,548,924) | 9,256,740,263 | 4,291,087,461 |
VIEs (primary beneficiary) | |||
Variable Interest Entity [Line Items] | |||
Net cash provided by operating activities | 340,962,220 | 3,858,370,455 | 843,392,296 |
Net cash provided by/(used in) investing activities | 301,170,602 | (8,905,181,155) | (5,109,269,063) |
Net cash provided by financing activities | ¥ 909,251,326 | ¥ 5,916,858,297 | ¥ 4,249,962,461 |
DESCRIPTION OF BUSINESS, ORGA_9
DESCRIPTION OF BUSINESS, ORGANIZATION, AND BASIS OF PRESENTATION (Detail Textuals) | Jul. 11, 2018$ / sharesshares | Mar. 27, 2018shares | Sep. 30, 2017CNY (¥) | Dec. 31, 2018CNY (¥)shares | Dec. 31, 2018$ / shares | Dec. 31, 2017CNY (¥) | Dec. 31, 2017$ / shares | Dec. 31, 2014CNY (¥) | Jan. 08, 2014$ / shares |
Description Of Business, Organization, And Basis Of Presentation [Line Items] | |||||||||
Ordinary shares exchanged for ordinary shares of parent company | 1,230,434,040 | ||||||||
Total issued and outstanding shares | 1,230,434,041 | 1 | |||||||
Shares issued, par value per share | (per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||
Total shares issued upon transferred | 1,230,434,040 | ||||||||
Cash and cash equivalents of structure funds | ¥ | ¥ 2,457,242,507 | ¥ 911,581,943 | |||||||
Sincere Fame International Limited ("Sincere Fame") | |||||||||
Description Of Business, Organization, And Basis Of Presentation [Line Items] | |||||||||
Ordinary shares exchanged for ordinary shares of parent company | 1,230,434,040 | ||||||||
Total shares issued upon transferred | 1,230,434,041 | ||||||||
Shenzhen Taotaojin Internet Financial Services Company Limited ("Taotaojin") | |||||||||
Description Of Business, Organization, And Basis Of Presentation [Line Items] | |||||||||
Registered capital | ¥ | ¥ 50,000,000 | ||||||||
Amount of consideration paid | ¥ | ¥ 215,000,000 | ||||||||
Recognized pre-tax gain on sale | ¥ | ¥ 2,336,201 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Detail Textuals) - CNY (¥) | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2016 | Dec. 31, 2017 | May 25, 2009 | Aug. 31, 2006 | |
Summary Of Significant Accounting Policies [Line Items] | |||||
Goodwill | ¥ 0 | ¥ 0 | |||
Weighted average growth rate estimated cash flows beyond next year | 3.00% | ||||
Projected cash flow discount rate | 21.00% | ||||
Goodwill impairment loss | ¥ 20,279,026 | ||||
Accumulated amortization | 12,518,252 | 12,204,977 | |||
Additional operating liabilities expected to be recognized | 120,958,574 | ||||
Software | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Accumulated amortization | ¥ 7,488,252 | 7,174,977 | |||
Software | Minimum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Intangible assets with finite useful lives | 1 year | ||||
Software | Maximum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Intangible assets with finite useful lives | 5 years | ||||
Cooperation agreement | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Intangible assets with finite useful lives | 5 years | ||||
Accumulated amortization | ¥ 5,030,000 | 5,030,000 | |||
Trademarks | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Indefinite-lived intangible assets carrying value | ¥ 2,970,000 | ¥ 2,970,000 | |||
Guangzhou Anyu Mortgage Consulting Co., Limited ("Guangzhou Anyu") | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Percentage of stake acquired from business combination | 45.00% | 55.00% | |||
Fair value of identifiable net assets | ¥ 42,360,000 | ||||
Identifiable net assets | ¥ 27,470,000 | 23,300,000 | |||
Goodwill | ¥ 20,280,000 | ||||
Office and other equipment | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Estimated useful life of Property and equipment | 1 to 5 years | ||||
Leasehold improvements | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Estimated useful life of Property and equipment | 1 to 6 years | ||||
Motor vehicles | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Estimated useful life of Property and equipment | 3 to 8 years |
DISPOSAL OF SUBSIDIARIES (Detai
DISPOSAL OF SUBSIDIARIES (Details) - Disposal on financial position of Group | Dec. 31, 2018CNY (¥) |
Effect of disposal on the financial position of the Group | |
Cash and cash equivalents | ¥ 10,532,048 |
Loans principal, interest and financing service fee receivables | 28,221,115 |
Available-for-sale investments | 33,616,143 |
Interest in equity method investee | 20,450,000 |
Property and equipment | 3,653,157 |
Intangible assets and goodwill | 23,333 |
Deferred tax assets | 12,779,966 |
Other assets | 320,606,280 |
Accrued employee benefits | (2,294,431) |
Income tax payable | (14,785,506) |
Other liabilities | (134,312,863) |
Net assets and liabilities | ¥ 278,489,242 |
DISPOSAL OF SUBSIDIARIES (Det_2
DISPOSAL OF SUBSIDIARIES (Detail Textuals) | 12 Months Ended |
Dec. 31, 2017CNY (¥) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Total gain on disposal of subsidiaries | ¥ 6,060,758 |
Disposal on financial position of Group | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Consideration received on disposal of subsidiaries | 284,550,000 |
Total gain on disposal of subsidiaries | ¥ 6,060,758 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - Fair value measurements recurring - Wealth management products - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Wealth management products | ¥ 682,252,159 | ¥ 360,187,885 |
Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Wealth management products | 0 | 0 |
Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Wealth management products | 682,252,159 | 360,187,885 |
Level 3 | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Wealth management products | ¥ 0 | ¥ 0 |
CASH AND CASH EQUIVALENTS (Deta
CASH AND CASH EQUIVALENTS (Detail Textuals) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Cash and Cash Equivalents [Abstract] | ||
Number of PRC individual financial institutions | 2 | 1 |
Percentage of excess cash balances | 10.00% | 10.00% |
Percentage bank deposits collectively accounted | 85.00% | 54.00% |
Percentage cash balances collectively accounted | 0.63% | 1.14% |
LOANS PRINCIPAL, INTEREST AND_3
LOANS PRINCIPAL, INTEREST AND FINANCING SERVICE FEE RECEIVABLES (Details) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 |
Receivables [Abstract] | ||
Loans principal, interest and financing service fee receivables | ¥ 15,861,324,470 | ¥ 16,701,504,043 |
Less: allowance for credit losses - Individually assessed | (157,157,377) | (98,736,342) |
Less: allowance for credit losses - Collectively assessed | (705,881,227) | (341,599,744) |
Subtotal | (863,038,604) | (440,336,086) |
Net loans principal, interest and financing service fee receivables | ¥ 14,998,285,866 | ¥ 16,261,167,957 |
LOANS PRINCIPAL, INTEREST AND_4
LOANS PRINCIPAL, INTEREST AND FINANCING SERVICE FEE RECEIVABLES (Details 1) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Components of allowances for loans principal, interest and financing service fee receivables | |||
Beginning Balance, January 1 | ¥ 440,336,086 | ¥ 144,743,336 | |
Provision for credit losses | 433,753,901 | 306,752,951 | ¥ 111,362,044 |
Charge-offs | (11,051,383) | (11,160,201) | |
Recoveries | 0 | 0 | |
Ending Balance, December 31 | 863,038,604 | 440,336,086 | 144,743,336 |
Net loans principal, interest and financing service fee receivables | 14,998,285,866 | 16,261,167,957 | |
Recorded investment | 15,861,324,470 | 16,701,504,043 | |
Allowance for loans which are collectively assessed | |||
Components of allowances for loans principal, interest and financing service fee receivables | |||
Beginning Balance, January 1 | 341,599,744 | 89,562,675 | |
Provision for credit losses | 364,289,770 | 252,549,185 | |
Charge-offs | (8,287) | (512,116) | |
Recoveries | 0 | 0 | |
Ending Balance, December 31 | 705,881,227 | 341,599,744 | 89,562,675 |
Net loans principal, interest and financing service fee receivables | 14,760,930,158 | 16,065,757,967 | |
Recorded investment | 15,466,811,385 | 16,407,357,711 | |
Allowance for loans which are individually assessed | |||
Components of allowances for loans principal, interest and financing service fee receivables | |||
Beginning Balance, January 1 | 98,736,342 | 55,180,661 | |
Provision for credit losses | 69,464,131 | 54,203,766 | |
Charge-offs | (11,043,096) | (10,648,085) | |
Recoveries | 0 | 0 | |
Ending Balance, December 31 | 157,157,377 | 98,736,342 | ¥ 55,180,661 |
Net loans principal, interest and financing service fee receivables | 237,355,708 | 195,409,990 | |
Recorded investment | ¥ 394,513,085 | ¥ 294,146,332 |
LOANS PRINCIPAL, INTEREST AND_5
LOANS PRINCIPAL, INTEREST AND FINANCING SERVICE FEE RECEIVABLES (Details 2) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total current | ¥ 12,929,493,099 | ¥ 15,477,867,781 |
Total loans | 15,861,324,470 | 16,701,504,043 |
Total non-accrual | 415,938,138 | 294,146,332 |
90 days past due and accruing | 0 | 0 |
1-30 days past due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total current | 1,031,203,259 | 723,143,029 |
31-90 days past due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total current | 1,484,689,974 | 206,346,901 |
91 - 180 days past due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total current | 159,343,805 | 136,276,334 |
>180 days past due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total current | ¥ 256,594,333 | ¥ 157,869,998 |
LOANS PRINCIPAL, INTEREST AND_6
LOANS PRINCIPAL, INTEREST AND FINANCING SERVICE FEE RECEIVABLES (Details 3) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 |
Receivables [Abstract] | ||
Unpaid principal balance | ¥ 417,625,050 | ¥ 299,550,322 |
Recorded investment, Impaired loans | 415,938,138 | 294,146,332 |
Recorded investment, Impaired loans with related allowance for credit losses | 358,477,762 | 242,037,110 |
Recorded investment, Impaired loans without related allowance for credit losses | 57,460,376 | 52,109,222 |
Related allowance for credit losses | ¥ 157,157,377 | ¥ 98,736,342 |
LOANS PRINCIPAL, INTEREST AND_7
LOANS PRINCIPAL, INTEREST AND FINANCING SERVICE FEE RECEIVABLES (Details 4) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Receivables [Abstract] | |||
Impaired loans, Average recorded investment | [1] | ¥ 335,515,156 | ¥ 193,518,814 |
Impaired loans, Interest and fees income recognized | [2] | ¥ 26,786,527 | ¥ 19,502,728 |
[1] | Average recorded investment represents ending balance for the last four quarters and does not include the related allowance for credit losses. | ||
[2] | The interest and fees income recognized are those interest and financing service fee recognized related to impaired loans. All the amounts are recognized on cash basis. |
LOANS PRINCIPAL, INTEREST AND_8
LOANS PRINCIPAL, INTEREST AND FINANCING SERVICE FEE RECEIVABLES (Detail Textuals) - CNY (¥) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Loans and Leases Receivable Disclosure [Line Items] | ||
Carrying amount of loans | ¥ 15,861,324,470 | ¥ 16,701,504,043 |
Net loss on sale of loans | (16,697,259) | |
Third party investors | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Carrying amount of loans | 184,621,473 | |
Net loss on sale of loans | (16,697,259) | |
Loans transferred to held-for-sale | ¥ 120,822,552 |
AVAILABLE-FOR-SALE INVESTMENT_2
AVAILABLE-FOR-SALE INVESTMENTS (Details) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 |
Debt Securities, Available-for-sale [Line Items] | ||
Aggregate fair value | ¥ 682,252,159 | ¥ 360,187,885 |
Wealth management products | ||
Debt Securities, Available-for-sale [Line Items] | ||
Aggregate cost basis | 680,000,000 | 360,050,000 |
Total OTTI recognized in OCI | 0 | 0 |
Gross unrealized holding gains | 2,252,159 | 137,885 |
Gross unrealized holding (losses) | 0 | 0 |
Aggregate fair value | ¥ 682,252,159 | ¥ 360,187,885 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 |
Property and equipment | ||
Less: accumulated depreciation | ¥ (31,326,808) | ¥ (20,394,541) |
Total | 19,166,229 | 22,467,900 |
Office and other equipment | ||
Property and equipment | ||
Property and equitment | 23,774,820 | 19,997,272 |
Leasehold improvements | ||
Property and equipment | ||
Property and equitment | 25,062,449 | 21,147,511 |
Motor vehicles | ||
Property and equipment | ||
Property and equitment | ¥ 1,655,768 | ¥ 1,717,658 |
PROPERTY AND EQUIPMENT (Detail
PROPERTY AND EQUIPMENT (Detail Textuals) - CNY (¥) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | ¥ 12,985,972 | ¥ 10,778,542 |
INTANGIBLE ASSETS AND GOODWIL_2
INTANGIBLE ASSETS AND GOODWILL (Details) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Intangible assets | ¥ 4,176,244 | ¥ 3,342,463 |
INTANGIBLE ASSETS AND GOODWIL_3
INTANGIBLE ASSETS AND GOODWILL (Details 1) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 |
Finite And Indefinite-Lived Intangible Assets [Line Items] | ||
Gross carrying value | ¥ 13,724,496 | ¥ 12,577,440 |
Accumulated amortization | (12,518,252) | (12,204,977) |
Net carrying value | 1,206,244 | 372,463 |
Trademarks | ||
Finite And Indefinite-Lived Intangible Assets [Line Items] | ||
Unamortized intangible assets | 2,970,000 | 2,970,000 |
Software | ||
Finite And Indefinite-Lived Intangible Assets [Line Items] | ||
Gross carrying value | 8,694,496 | 7,547,440 |
Accumulated amortization | (7,488,252) | (7,174,977) |
Net carrying value | 1,206,244 | 372,463 |
Cooperation agreement | ||
Finite And Indefinite-Lived Intangible Assets [Line Items] | ||
Gross carrying value | 5,030,000 | 5,030,000 |
Accumulated amortization | (5,030,000) | (5,030,000) |
Net carrying value | ¥ 0 | ¥ 0 |
INTANGIBLE ASSETS AND GOODWIL_4
INTANGIBLE ASSETS AND GOODWILL (Details 2) | Dec. 31, 2018CNY (¥) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Year ended December 31, 2018 (actual) | ¥ 313,274 |
Estimate for year ended December 31, | |
2019 | 515,055 |
2020 | 489,022 |
2021 | 202,167 |
2022 | 0 |
2023 | ¥ 0 |
DEPOSITS (Detail Textuals)
DEPOSITS (Detail Textuals) | 12 Months Ended |
Dec. 31, 2018 | |
Deposits [Abstract] | |
Percentage of size of trust plans subscribed | 1.00% |
OTHER ASSETS (Details)
OTHER ASSETS (Details) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 |
Other Assets [Abstract] | ||
Equity securities | ¥ 40,010,000 | ¥ 40,010,000 |
Less: impairment losses | 0 | 0 |
Receivable from private equity funds - Principal | 21,350,000 | 0 |
Receivable from private equity funds - Interest | 4,523,205 | 0 |
Receivables from disposal of subsidiaries | 0 | 29,658,807 |
Prepayments | 6,741,881 | 13,053,454 |
Receivables for realization of collaterals | 7,164,458 | 10,504,570 |
Amounts due from employees | 10,126,228 | 10,027,597 |
Commission and fee receivables | 2,323,085 | 6,686,148 |
Less: impairment losses | (2,323,085) | (2,323,085) |
Other receivables | 3,429,580 | 7,866,237 |
Total | ¥ 93,345,352 | ¥ 115,483,728 |
OTHER ASSETS (Detail Textuals)
OTHER ASSETS (Detail Textuals) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2016 | Dec. 31, 2013 |
Other Assets [Line Items] | ||||
Impairment losses | ¥ 0 | ¥ 0 | ||
Impairment losses for commission and fee receivables | 2,323,085 | 2,323,085 | ||
Huangpu Ronghe | ||||
Other Assets [Line Items] | ||||
Percentage of paid up capital invested | 10.00% | |||
Paid-in capital | 100,000,000 | 100,000,000 | ||
Amount of investment | 10,000,000 | 10,000,000 | ||
Qingyuan Rural | ||||
Other Assets [Line Items] | ||||
Percentage of paid up capital invested | 2.14% | |||
Paid-in capital | 140,000,000 | 140,000,000 | ||
Amount of investment | ¥ 30,010,000 | ¥ 30,010,000 |
INTEREST-BEARING BORROWINGS (De
INTEREST-BEARING BORROWINGS (Details) - CNY (¥) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross obligations under repurchase agreements | ¥ 4,213,900,028 | ¥ 3,512,114,961 |
Funds obtained from Internet funding platforms | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Term | 3 to 12 months | 3 to 12 months |
Gross obligations under repurchase agreements | ¥ 0 | ¥ 1,405,217,000 |
Funds obtained from Internet funding platforms | Minimum | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Fixed interest rate per annum | 9.70% | 9.70% |
Funds obtained from Internet funding platforms | Maximum | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Fixed interest rate per annum | 14.00% | 14.00% |
Funds obtained from Private investment funds | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Term | Less than 1 year | Less than 1 year |
Gross obligations under repurchase agreements | ¥ 2,540,140,000 | ¥ 2,042,700,000 |
Funds obtained from Private investment funds | Minimum | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Fixed interest rate per annum | 10.00% | 10.00% |
Funds obtained from Private investment funds | Maximum | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Fixed interest rate per annum | 16.00% | 16.00% |
Funds obtained from asset management company | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Fixed interest rate per annum | 14.00% | 14.00% |
Term | Less than 1 year | Less than 1 year |
Gross obligations under repurchase agreements | ¥ 10,000,000 | ¥ 0 |
Funds obtained from financial institution | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Fixed interest rate per annum | 12.10% | 12.10% |
Term | Within 4 years | Within 4 years |
Gross obligations under repurchase agreements | ¥ 1,625,676,189 | ¥ 0 |
Interest payable internet funding platforms | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross obligations under repurchase agreements | 0 | 50,757,320 |
Interest payable private investment funds | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross obligations under repurchase agreements | 20,046,580 | 13,440,641 |
Interest payable asset management company | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross obligations under repurchase agreements | 713,425 | 0 |
Interest payable financial institution | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross obligations under repurchase agreements | ¥ 17,323,834 | ¥ 0 |
INTEREST-BEARING BORROWINGS (_2
INTEREST-BEARING BORROWINGS (Details 1) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 |
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross obligations under repurchase agreements | ¥ 4,213,900,028 | ¥ 3,512,114,961 |
Rights to earnings in the Group's subordinate tranches of consolidated VIEs | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross obligations under repurchase agreements | 2,381,636,580 | 3,265,076,611 |
Rights to earnings in loans principal, interest and financing service fee receivables | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross obligations under repurchase agreements | 189,263,425 | 247,038,350 |
Loans principal, interest and financing service fee receivables | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross obligations under repurchase agreements | ¥ 1,643,000,023 | ¥ 0 |
INTEREST-BEARING BORROWINGS (_3
INTEREST-BEARING BORROWINGS (Details 2) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 |
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross obligations under repurchase agreements | ¥ 4,213,900,028 | ¥ 3,512,114,961 |
Overnight | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross obligations under repurchase agreements | 0 | 0 |
Up to 30 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross obligations under repurchase agreements | 344,050,001 | 114,331,541 |
30 to 90 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross obligations under repurchase agreements | 569,088,175 | 366,877,171 |
Greater than 90 days | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Gross obligations under repurchase agreements | ¥ 3,300,761,852 | ¥ 3,030,906,249 |
INTEREST-BEARING BORROWINGS (_4
INTEREST-BEARING BORROWINGS (Details 3) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Other borrowings | ¥ 11,110,876,011 | ¥ 12,195,821,217 | |
Short-term | Investors of consolidated VIEs | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Term | Less than 1 year | Less than 1 year | |
Short-term | [1] | ¥ 4,237,790,000 | ¥ 8,123,145,600 |
Short-term | Investors of consolidated VIEs | Minimum | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Fixed interest rate per annum | 7.00% | 7.00% | |
Short-term | Investors of consolidated VIEs | Maximum | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Fixed interest rate per annum | 13.00% | 13.00% | |
Short-term | Investors of internet funding platforms | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Term | 3 to 12 months | 3 to 12 months | |
Short-term | [2] | ¥ 0 | ¥ 184,157,982 |
Short-term | Investors of internet funding platforms | Minimum | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Fixed interest rate per annum | 9.70% | 9.70% | |
Short-term | Investors of internet funding platforms | Maximum | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Fixed interest rate per annum | 14.00% | 14.00% | |
Short-term | Asset management partnerships | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Term | Less than 1 year | Less than 1 year | |
Short-term | [3] | ¥ 78,950,000 | ¥ 75,000,000 |
Short-term | Asset management partnerships | Minimum | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Fixed interest rate per annum | 11.00% | 11.00% | |
Short-term | Asset management partnerships | Maximum | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Fixed interest rate per annum | 15.00% | 15.00% | |
Short-term | Trust company | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Fixed interest rate per annum | 10.89% | ||
Term | Less than 1 year | Less than 1 year | |
Short-term | [4] | ¥ 0 | ¥ 110,000,000 |
Short-term | Senior tranche of asset management product which invests in the Group's loans portfolio | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Fixed interest rate per annum | 8.50% | ||
Term | Less than 1 year | Less than 1 year | |
Short-term | [5] | ¥ 0 | ¥ 25,992,786 |
Short-term | Investors of wealth management product which invests in the Group's loans portfolio | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Fixed interest rate per annum | 11.00% | ||
Term | Less than 1 year | Less than 1 year | |
Short-term | [6] | ¥ 10,423,230 | ¥ 0 |
Short-term | Micro-credit companies | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Fixed interest rate per annum | 13.50% | 13.50% | |
Term | Less than 1 year | Less than 1 year | |
Short-term | [7] | ¥ 30,000,000 | ¥ 0 |
Long-term | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Amount of long-term funds obtained | ¥ 6,631,155,444 | ||
Long-term | Investors of consolidated VIEs | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Term | Within 5 years | Within 5 years | |
Amount of long-term funds obtained | [1] | ¥ 6,548,437,241 | ¥ 3,380,980,000 |
Long-term | Investors of consolidated VIEs | Minimum | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Fixed interest rate per annum | 11.80% | 11.80% | |
Long-term | Investors of consolidated VIEs | Maximum | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Fixed interest rate per annum | 12.70% | 12.70% | |
Long-term | Senior tranche of trust plan which invests in the Group's loans portfolio | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Fixed interest rate per annum | 10.24% | 10.24% | |
Term | Within 4 years | Within 4 years | |
Amount of long-term funds obtained | [8] | ¥ 82,718,203 | ¥ 131,263,590 |
Other borrowings | Investors of consolidated VIEs | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Other borrowings | [1] | 121,127,920 | 147,849,661 |
Other borrowings | Investors of internet funding platforms | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Other borrowings | [2] | 0 | 2,148,517 |
Other borrowings | Asset management partnerships | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Other borrowings | [3] | 1,275,806 | 9,860,151 |
Other borrowings | Trust company | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Other borrowings | [4] | 0 | 4,854,255 |
Other borrowings | Senior tranche of asset management product which invests in the Group's loans portfolio | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Other borrowings | [5] | 0 | 117,284 |
Other borrowings | Senior tranche of trust plan which invests in the Group's loans portfolio | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Other borrowings | [8] | 0 | 451,391 |
Other borrowings | Micro-credit companies | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
Other borrowings | [7] | ¥ 153,611 | ¥ 0 |
[1] | The financial liabilities arising from the VIEs with underlying investments in loans to customers are classified as payables in these consolidated financial statements. It is because the Group has an obligation to pay senior tranches holders upon maturity dates of the structured entities based on the related terms of those consolidated structured funds. | ||
[2] | The borrowings from investor of internet funding platforms are funds raised from investors like a company named Shenzhen Taotaojin, bearing interest rate from 9.7% to 14% per year. As of December 31, 2018, the borrowings have been fully paid. | ||
[3] | As of December 31, 2018, the borrowings from asset management partnerships are from (1) Zhuhai Longhua Qifu NO.1 Fund Partnership (Limited Partnership) with principal RMB50 million, (2) Ningbo Longhua Zhihe Investment Management Partnership (Limited Partnership) with principal RMB20 million, (3) Jilin Northeast Asia Innovation Financial Assets Trading Center Co., Ltd. with principal RMB8.95 million, bearing interest at 11%, 11.47% and 15% per year, respectively. | ||
[4] | The borrowings from trust company is from Shanxi Trust Limited Company, bearing interest at 10.89% per year. As of December 31, 2018, the borrowings has been fully paid. | ||
[5] | The borrowings from senior tranche of asset management product which invests in the Group's loans portfolio are the capitals from senior tranche holders of Zhaoqian Jinjiao Fanhua Asset Management Product, bearing interest at 8.5% per year. As of December 31, 2018, the borrowings has been fully paid. | ||
[6] | The borrowings from Investors of wealth management product which invests in the Group's loans portfolio are the capitals from A-class purchasers of Lianda Baoli Co., Ltd, with principal RMB10.42 million on December 31, 2018, bearing interest at 11% per year. | ||
[7] | The borrowings are from Guangdong Province Yueke Technology Micro-credit Co., Ltd. with principal RMB10 million and RMB20 million. The interest-bearing borrowings bear interest at 13.5% and 13% per year, respectively. | ||
[8] | As of December 31, 2018, the borrowings from senior tranche of trust plan which invests in the Group's loans portfolio are the capitals from senior tranche holders of No.1 Wukuang Trust Yangguang Fanhua Plan with principal RMB82.72 million, bearing interest at 10.24% per year. |
INTEREST-BEARING BORROWINGS (_5
INTEREST-BEARING BORROWINGS (Details 4) - Long-term - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 | |
Assets Sold under Agreements to Repurchase [Line Items] | |||
2019 | ¥ 43,782,203 | ||
2020 | 5,945,985,684 | ||
2021 | 244,429,800 | ||
2022 | 0 | ||
2023 | 291,705,438 | ||
Thereafter | 105,252,319 | ||
Long-term Debt | 6,631,155,444 | ||
Investors of consolidated VIEs | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
2019 | 0 | ||
2020 | 5,914,569,684 | ||
2021 | 236,909,800 | ||
2022 | 0 | ||
2023 | 291,705,438 | ||
Thereafter | 105,252,319 | ||
Long-term Debt | [1] | 6,548,437,241 | ¥ 3,380,980,000 |
Senior tranche of trust plan which invests in the Group's loans portfolio | |||
Assets Sold under Agreements to Repurchase [Line Items] | |||
2019 | 43,782,203 | ||
2020 | 31,416,000 | ||
2021 | 7,520,000 | ||
2022 | 0 | ||
2023 | 0 | ||
Thereafter | 0 | ||
Long-term Debt | [2] | ¥ 82,718,203 | ¥ 131,263,590 |
[1] | The financial liabilities arising from the VIEs with underlying investments in loans to customers are classified as payables in these consolidated financial statements. It is because the Group has an obligation to pay senior tranches holders upon maturity dates of the structured entities based on the related terms of those consolidated structured funds. | ||
[2] | As of December 31, 2018, the borrowings from senior tranche of trust plan which invests in the Group's loans portfolio are the capitals from senior tranche holders of No.1 Wukuang Trust Yangguang Fanhua Plan with principal RMB82.72 million, bearing interest at 10.24% per year. |
INTEREST-BEARING BORROWINGS (_6
INTEREST-BEARING BORROWINGS (Details 5) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 |
Assets Sold under Agreements to Repurchase [Line Items] | ||
Pledged assets | ¥ 5,568,519,362 | ¥ 4,667,344,920 |
Rights to earnings in the Group's subordinate tranches of consolidated VIEs | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Pledged assets | 3,474,391,373 | 4,173,931,373 |
Rights to earnings in loans principal, interest and financing service fee receivables | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Pledged assets | 554,154,772 | 493,413,547 |
Loans principal, interest and financing service fee receivables | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Pledged assets | ¥ 1,539,973,217 | ¥ 0 |
INTEREST-BEARING BORROWINGS (_7
INTEREST-BEARING BORROWINGS (Detail Textuals) - CNY (¥) | Nov. 20, 2018 | Jul. 11, 2018 | Jun. 15, 2018 | Dec. 31, 2018 | Dec. 17, 2018 | Jun. 07, 2018 |
Xiamen Asset Management Co., Ltd. ("Xiamen Asset") | ||||||
Assets Sold under Agreements to Repurchase [Line Items] | ||||||
Loans principal, interest and financing service fee receivables with carrying amount | ¥ 499,999,800 | ¥ 499,521,447 | ||||
Interest rate | 12.10% | |||||
Terms of transferred loans overdue | 90 days | |||||
Amount of long-term funds obtained | ¥ 846,513,676 | |||||
Interest payable | 10,882,954 | |||||
WEIHAI BLUE OCEAN BANK Co.Ltd. ("BLUE OCEAN") | ||||||
Assets Sold under Agreements to Repurchase [Line Items] | ||||||
Loans principal, interest and financing service fee receivables with carrying amount | ¥ 499,991,939 | |||||
Interest rate | 12.10% | |||||
Terms of transferred loans overdue | 80 days | |||||
Amount of long-term funds obtained | 326,580,472 | |||||
Interest payable | 4,037,910 | |||||
Haide Asset Management Co., Ltd. ("Haide Asset") | ||||||
Assets Sold under Agreements to Repurchase [Line Items] | ||||||
Loans principal, interest and financing service fee receivables with carrying amount | ¥ 200,000,000 | |||||
Interest rate | 12.10% | |||||
Terms of transferred loans overdue | 90 days | |||||
Amount of long-term funds obtained | 152,972,873 | |||||
Interest payable | ¥ 1,906,356 | |||||
Suzhou Asset Management Co., Ltd. ("Suzhou Asset") | ||||||
Assets Sold under Agreements to Repurchase [Line Items] | ||||||
Loans principal, interest and financing service fee receivables with carrying amount | ¥ 299,609,168 | |||||
Interest rate | 12.10% | |||||
Terms of transferred loans overdue | 90 days | |||||
Amount of long-term funds obtained | ¥ 299,609,168 | |||||
Interest payable | ¥ 496,614 |
INTEREST-BEARING BORROWINGS (_8
INTEREST-BEARING BORROWINGS (Detail Textuals 1) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 |
Assets Sold under Agreements to Repurchase [Line Items] | ||
Carrying value of collateral for repurchase agreements | ¥ 5,369,457,734 | ¥ 4,409,898,351 |
Shenzhen Taotaojin | Minimum | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Interest rate | 9.70% | |
Shenzhen Taotaojin | Maximum | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Interest rate | 14.00% | |
Shanxi Trust Limited Company | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Interest rate | 10.89% | |
Zhaoqian Jinjiao Fanhua Asset Management Product | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Interest rate | 8.50% | |
Wukuang Trust Yangguang Fanhua Plan | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Principal payment | ¥ 82,720,000 | |
Interest rate | 10.24% | |
Guangdong Province Yueke Technology Micro-credit Co., Ltd | Minimum | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Principal payment | ¥ 10,000,000 | |
Interest rate | 13.50% | |
Guangdong Province Yueke Technology Micro-credit Co., Ltd | Maximum | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Principal payment | ¥ 20,000,000 | |
Interest rate | 13.00% | |
Lianda Baoli Co., Ltd | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Principal payment | ¥ 10,420,000 | |
Interest rate | 11.00% | |
Zhuhai Longhua Qifu NO.1 Fund Partnership (Limited Partnership) | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Principal payment | ¥ 50,000,000 | |
Interest rate | 11.00% | |
Ningbo Longhua Zhihe Investment Management Partnership (Limited Partnership) | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Principal payment | ¥ 20,000,000 | |
Interest rate | 11.47% | |
Jilin Northeast Asia Innovation Financial Assets Trading Center Co., Ltd | ||
Assets Sold under Agreements to Repurchase [Line Items] | ||
Principal payment | ¥ 8,950,000 | |
Interest rate | 15.00% |
OTHER LIABILITIES (Details)
OTHER LIABILITIES (Details) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 | |
Other Liabilities Disclosure [Abstract] | |||
Customer pledged deposits | [1] | ¥ 77,726,077 | ¥ 106,006,039 |
Other tax payables | [2] | 89,586,329 | 75,915,052 |
Receipt in advance | [3] | 44,083,940 | 6,979,476 |
Settlement and clearing accounts | [4] | 10,112,678 | 0 |
Amounts due to third parties | 10,952,518 | 7,004,153 | |
Expenses payable to suppliers | 8,868,056 | 10,611,883 | |
Others | 10,156,157 | 17,220,665 | |
Total | ¥ 251,485,755 | ¥ 223,737,268 | |
[1] | Customer pledged deposits mainly consist of the deposits collected from certain customers to reduce the risk of failure to make payments on schedule. | ||
[2] | Other tax payables mainly represents value-added tax payables. | ||
[3] | Receipt in advance consist of advance for interest and financing service fees on loans and down payments by loan transferees. Down payments are newly increase in 2018, amounting to RMB35,493,777. | ||
[4] | The Group transferred loans to third party investors and recorded these transactions as sales in Note 6(c). After the transfer, the contract terms related to payment proceeds of the loans remain the same: the Group collects payments of loans and then disburses the proceeds from the relevant loans to third-party transferees. |
OTHER LIABILITIES (Details Text
OTHER LIABILITIES (Details Textual) | 12 Months Ended |
Dec. 31, 2018CNY (¥) | |
Other Liabilities Disclosure [Abstract] | |
Down payment | ¥ 35,493,777 |
ORDINARY SHARES (Detail Textual
ORDINARY SHARES (Detail Textuals) | Nov. 21, 2018$ / sharesshares | Nov. 07, 2018$ / sharesshares | Jul. 11, 2018USD ($)$ / sharesshares | Jan. 08, 2014HKD ($)$ / sharesshares | Dec. 31, 2018$ / sharesshares | Jul. 11, 2018$ / shares |
Subsidiary, Sale of Stock [Line Items] | ||||||
Authorized share capital value | $ 380,000 | $ 380,000 | ||||
Authorized share capital shares | 3,800,000,000 | 3,800,000,000 | 3,800,000,000 | |||
Nominal or par value (in dollars per share) | (per share) | $ 0.0001 | $ 0.0001 | ||||
Consideration per share of one subscriber's share allotted and issued to Kevin Butler | (per share) | $ 0.0001 | $ 0.0001 | ||||
Percentage ordinary shares of one subscriber's share allotted and issued to Kevin Butler | 100.00% | |||||
Number of shares repurchased | 1,230,434,041 | |||||
Shares repurchased, price per share | $ / shares | $ 0.0001 | |||||
Number of shares issued | 1,230,434,040 | |||||
IPO | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Nominal or par value (in dollars per share) | $ / shares | $ 7.5 | |||||
Number of ADS issued | 6,500,000 | |||||
Number of shares issued | 130,000,000 | |||||
Green shoes options | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Nominal or par value (in dollars per share) | $ / shares | $ 7.5 | $ 7.5 | ||||
Number of ADS issued | 135,460 | 425,000 | ||||
Number of shares issued | 2,709,200 | 8,500,000 |
RETAINED EARNINGS (Details)
RETAINED EARNINGS (Details) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 | |
Retained Earnings Note Disclosure [Abstract] | |||
PRC statutory reserves | [1] | ¥ 258,654,052 | ¥ 258,654,052 |
PRC surplus reserves | [2] | 122,148,068 | 63,124,291 |
Unreserved retained earnings | 1,746,699,587 | 944,814,653 | |
Total | ¥ 2,127,501,707 | ¥ 1,266,592,996 | |
[1] | With effect from July 1, 2012, pursuant to the "Administrative Measures on Accrual of Provisions by Financial Institutions" issued by the MOF in March 2012, the Group is required, in principle, to set aside a general reserve not lower than 1.5% of the ending balance of its gross risk-bearing assets. | ||
[2] | In accordance with the Company's PRC subsidiaries' articles of associate, the subsidiaries are required to appropriate 10% of their net incomes, upon approval by board of directors. |
RETAINED EARNINGS (Detail Textu
RETAINED EARNINGS (Detail Textuals) | 1 Months Ended | 12 Months Ended |
Mar. 31, 2012 | Dec. 31, 2018 | |
Retained Earnings Note Disclosure [Abstract] | ||
Percentage of gross risk bearing assets | 1.50% | |
Percentage of net income approval by board of directors | 10.00% |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME/ (LOSSES) (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance as of January 1 | ¥ (4,469,444) | ||
Other comprehensive loss, net Net-of-tax amount | 1,585,705 | ¥ (2,601,355) | ¥ (194,680,052) |
Balance as of December 31 | (4,566,518) | (4,469,444) | |
Foreign currency translation adjustment | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance as of January 1 | (4,572,858) | (4,374,064) | |
Foreign currency translation adjustment | (1,682,779) | (198,794) | |
Balance as of December 31 | (6,255,637) | (4,572,858) | (4,374,064) |
Unrealized gain on available-for-sale investments | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Before tax amount, Balance as of January 1 | 137,885 | 3,606,359 | |
Tax (expenses) or benefits, Balance as of January 1 | (34,471) | (901,590) | |
Balance as of January 1 | 103,414 | 2,704,769 | |
Other comprehensive loss, net Before tax amount | 2,114,274 | (3,468,474) | |
Other comprehensive loss, net Tax (expenses) or benefits | (528,569) | 867,119 | |
Other comprehensive loss, net Net-of-tax amount | 1,585,705 | (2,601,355) | |
Before tax amount as of December 31 | 2,252,159 | 137,885 | 3,606,359 |
Tax (expenses) or benefits, Balance as of December 31 | (563,040) | (34,471) | (901,590) |
Balance as of December 31 | ¥ 1,689,119 | ¥ 103,414 | ¥ 2,704,769 |
INTEREST AND FINANCING SERVIC_2
INTEREST AND FINANCING SERVICE FEE ON LOANS (Detail textuals) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Interest and Fee Income, Loans, Commercial [Abstract] | |||
Interest income on loans | ¥ 4,150,727,434 | ¥ 3,154,190,318 | ¥ 1,022,891,039 |
Financing service fee on loans | ¥ 128,092,934 | ¥ 251,920,274 | ¥ 219,237,485 |
REALIZED GAINS_(LOSSES) ON SA_2
REALIZED GAINS/(LOSSES) ON SALES OF INVESTMENTS, NET (Detail Textuals) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Realized Investment Gains (Losses) [Abstract] | |||
Gross realized gains on sales of investments | ¥ 3,185,026 | ¥ 9,024,132 | ¥ 106,076,664 |
Gross realized losses on sales of investments | ¥ 20,551,930 | ¥ 39,198,163 |
OTHER GAINS_(LOSSES), NET (Deta
OTHER GAINS/(LOSSES), NET (Details) - CNY (¥) | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Other Revenue, Net [Line Items] | ||||
Net gain on disposal of subsidiaries | ¥ 0 | ¥ 6,060,758 | ¥ 0 | |
Foreign exchange gain/(loss) | 1,836,029 | (2,274,438) | 2,717,820 | |
Net loss on disposal of property and equipment | (946,244) | (261,875) | (61,085) | |
Net loss on sale of loans | (16,697,259) | |||
Others | (3,242,074) | 2,702,734 | (670,412) | |
Total | (14,582,940) | 23,979,610 | 36,261,933 | |
Mortgage agency service revenue | ||||
Other Revenue, Net [Line Items] | ||||
Total | [1] | 4,466,608 | 8,395,774 | 12,373,044 |
Asset management revenue | ||||
Other Revenue, Net [Line Items] | ||||
Total | [2] | 0 | 1,316,186 | 9,628,621 |
Labour outsourcing services income | ||||
Other Revenue, Net [Line Items] | ||||
Total | [3] | 0 | 7,857,461 | 12,035,445 |
Register services income | ||||
Other Revenue, Net [Line Items] | ||||
Total | ¥ 0 | ¥ 183,010 | ¥ 238,500 | |
[1] | The Group earns fees from providing mortgage agency services to borrowers applying for a bank loan. This kind of revenue is recognized at the time when loan is granted as that is the point of time the Group fulfils the customer's request, and is then recognized on an accrual basis in accordance with the terms of the relevant agreements. Mortgage agency service revenue consists of revenue earned from housing mortgage agency service and cars mortgage agency service, which accounted for 59.73% and 40.27% of mortgage agency service revenue in the year of 2018, respectively. | |||
[2] | The Group receives asset management revenue from providing asset management services for investors. The asset management revenue is calculated and accrued on a daily basis based on the daily net asset value of the asset management products under management. The asset management business has been disposed of in 2017. | |||
[3] | The Group receives labour outsourcing services income from providing labour outsourcing services to clients by one of the subsidiaries of the Group. Labour outsourcing services income are recognized on an accrual basis in accordance with the terms of the relevant agreements. As the subsidiary was disposed of in 2017, there would be no such income in the future. |
OTHER GAINS_(LOSSES), NET (Pare
OTHER GAINS/(LOSSES), NET (Parentheticals) (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Housing mortgage agency service | |
Other Revenue, Net [Line Items] | |
Percentage of revenue earned | 59.73% |
Cars mortgage agency service | |
Other Revenue, Net [Line Items] | |
Percentage of revenue earned | 40.27% |
OTHER EXPENSES (Details)
OTHER EXPENSES (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Other Expenses [Abstract] | |||
Consulting fees | ¥ 38,031,501 | ¥ 9,282,890 | ¥ 5,736,437 |
Advertising and promotion expenses | 15,323,838 | 15,028,164 | 16,383,290 |
Office expenses | 14,425,608 | 18,769,477 | 14,453,830 |
Entertainment and travelling expenses | 14,237,820 | 14,506,006 | 11,767,688 |
Depreciation and amortization | 13,299,246 | 10,804,855 | 6,595,476 |
Communication expenses | 2,549,164 | 2,598,250 | 2,530,162 |
Research and development expenses | 1,419,878 | 4,794,998 | 8,507,265 |
Asset management expenses | 0 | 0 | 3,887,977 |
Provision for cost method investment | 1,270,001 | ||
Others | 14,268,602 | 6,409,916 | 4,675,782 |
Total | ¥ 113,555,657 | ¥ 82,194,556 | ¥ 75,807,908 |
INCOME TAX EXPENSE (Details)
INCOME TAX EXPENSE (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||
Current tax expense | ¥ 401,913,951 | ¥ 333,883,691 | ¥ 86,073,560 |
Deferred tax benefit | (105,085,476) | (57,888,823) | (33,470,137) |
Total income tax expense | ¥ 296,828,475 | ¥ 275,994,868 | ¥ 52,603,423 |
INCOME TAX EXPENSE (Details 1)
INCOME TAX EXPENSE (Details 1) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred tax assets: | |||
Allowance for loans principal | ¥ 205,058,644 | ¥ 105,191,243 | |
Allowance for interest and financing fee receivables | 11,281,778 | 5,473,550 | |
Allowance for available-for-sale investments | 0 | 0 | |
Net operating loss carry-forwards | 5,743,768 | 12,610,881 | |
Other deferred tax assets | 1,275,001 | 1,865,154 | |
Subtotal of deferred tax assets | 223,359,191 | 125,140,828 | |
Valuation allowance | (5,743,768) | (12,610,881) | ¥ (21,743,157) |
Total deferred tax assets | 217,615,423 | 112,529,947 | |
Deferred tax liabilities: | |||
Intangible assets | (742,500) | (742,500) | |
Available-for-sale investments | (563,040) | (34,471) | |
Total deferred tax liabilities | ¥ (1,305,540) | ¥ (776,971) |
INCOME TAX EXPENSE (Details 2)
INCOME TAX EXPENSE (Details 2) - CNY (¥) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Movement Of Valuation Allowance [Roll Forward] | ||
At the beginning of year | ¥ 12,610,881 | ¥ 21,743,157 |
Current year additions | 1,572,672 | 8,512,244 |
Current year reversals | (8,391,178) | (2,433,708) |
Current year charge-offs | (48,607) | (25,800) |
Current year disposal | 0 | (15,185,012) |
At the end of year | ¥ 5,743,768 | ¥ 12,610,881 |
INCOME TAX EXPENSE (Details 3)
INCOME TAX EXPENSE (Details 3) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Contingency [Line Items] | |||
Total | ¥ 1,157,737,186 | ¥ 808,667,625 | ¥ 288,045,262 |
PRC entities | |||
Income Tax Contingency [Line Items] | |||
Total | 1,157,657,930 | 817,571,481 | 288,610,139 |
Non-PRC entities | |||
Income Tax Contingency [Line Items] | |||
Total | ¥ 79,256 | ¥ (8,903,856) | ¥ (564,877) |
INCOME TAX EXPENSE (Details 4)
INCOME TAX EXPENSE (Details 4) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||
PRC statutory income tax rate | 25.00% | 25.00% | 25.00% |
(Decrease)/Increase in effective income tax rate resulting from: | |||
Effect of tax holiday | (0.00%) | (0.51%) | (13.16%) |
Effect of tax-free income | (0.03%) | (4.00%) | (8.10%) |
Effect of disposal of subsidiaries | 0.00% | 6.53% | 0.00% |
Effect of Non-deductible share option expense | 0.86% | 5.65% | 0.00% |
Effect of zero tax rate in foreign countries | 0.00% | 0.27% | (0.02%) |
Effect of transfer pricing | 0.00% | 0.32% | 6.88% |
Changes in valuation allowance | (0.59%) | 0.75% | 5.73% |
Others | 0.42% | 0.11% | 1.93% |
Effective income tax rate | 25.66% | 34.12% | 18.26% |
INCOME TAX EXPENSE (Detail Text
INCOME TAX EXPENSE (Detail Textuals) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Contingency [Line Items] | |||
PRC statutory income tax rate | 25.00% | 25.00% | 25.00% |
Effect of tax holiday to income tax expense | ¥ 4,000,000 | ¥ 38,000,000 | |
Basic earnings per ordinary share (in dollars per share) | ¥ 0.003 | ¥ 0.031 | |
Diluted earnings per ordinary share (in dollars per share) | ¥ 0.003 | ¥ 0.031 | |
Net operating loss carry forwards | ¥ 22,975,070 | ||
Deferred tax assets net operating loss carry-forwards | 5,743,768 | ¥ 12,610,881 | |
Cumulative amount of temporary difference in respect of investments PRC subsidiaries | ¥ 2,163,633,590 | ||
Percentage of withholding income tax | 10.00% | ||
Amount of unrecognized deferred tax liabilities | ¥ 216,363,359 | ||
Net operating losses subject to expiration in year in 2022 and 2023 | 16,684,382 | ||
Net operating losses subject to expiration if not utilized | ¥ 6,290,688 | ||
Shenzhen Taotaojin Internet Financial Services Company Limited ("Taotaojin") | |||
Income Tax Contingency [Line Items] | |||
Reduction of the income tax rate | 50.00% |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |||
Net income | ¥ 860,908,711 | ¥ 532,672,757 | ¥ 235,441,839 |
Basic weighted average number of common shares outstanding | 1,251,608,224 | 1,230,434,041 | 1,230,434,041 |
Effect of dilutive share options | ¥ 137,727,545 | ¥ 100,975,533 | ¥ 0 |
Dilutive weighted average number of ordinary shares | 1,389,335,769 | 1,331,409,574 | 1,230,434,041 |
Basic earnings per share | ¥ 0.69 | ¥ 0.43 | ¥ 0.19 |
Diluted earnings per share | ¥ 0.62 | ¥ 0.40 | ¥ 0.19 |
EARNINGS PER SHARE (Detail Text
EARNINGS PER SHARE (Detail Textuals) - shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |||
Basic weighted average number of common shares outstanding | 1,251,608,224 | 1,230,434,041 | 1,230,434,041 |
SHARE-BASED COMPENSATION EXPE_3
SHARE-BASED COMPENSATION EXPENSES (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Share awards granted on November 1, 2009 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected volatility | 71.00% |
Expected dividends | 0.00% |
Risk-free interest rate | 3.50% |
Expected term (in years) | 5 years |
Expected life (in years) | 7 years 2 months 1 day |
Share awards granted on January 3, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected volatility | 40.00% |
Expected dividends | 0.00% |
Risk-free interest rate | 3.10% |
Expected term (in years) | 5 years |
Expected life (in years) | 6 years |
SHARE-BASED COMPENSATION EXPE_4
SHARE-BASED COMPENSATION EXPENSES (Details 1) - Share Incentive Plan 2017 and 2018 - ¥ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Number of shares | ||
Balance | 187,933,730 | 0 |
Granted | 0 | 187,933,730 |
Exercised | 0 | 0 |
Surrendered | 0 | 0 |
Balance | 187,933,730 | 187,933,730 |
Exercisable | 150,346,984 | 112,760,238 |
Expected to vest | 37,586,746 | 75,173,492 |
Weighted average exercise price | ||
Balance | ¥ 0 | ¥ 0 |
Granted | 0 | 0 |
Exercised | 0 | 0 |
Surrendered | 0 | 0 |
Balance | 0 | 0 |
Exercisable | 0 | 0 |
Expected to vest | 0 | 0 |
Weighted average grant date fair value | ||
Balance | 1.27 | 0 |
Granted | 0 | 1.27 |
Exercised | 0 | 0 |
Surrendered | 0 | 0 |
Balance | 1.27 | 1.27 |
Exercisable | 1.27 | 1.27 |
Expected to vest | ¥ 1.27 | ¥ 1.27 |
SHARE-BASED COMPENSATION EXPE_5
SHARE-BASED COMPENSATION EXPENSES (Details 2) | 12 Months Ended |
Dec. 31, 2018¥ / sharesshares | |
Share awards granted on November 1, 2009 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options granted | shares | 25,678 |
Exercise price | ¥ 3,190 |
Fair value of option | 640.10 |
Fair value of ordinary shares | ¥ 1,506 |
Share awards granted on January 3, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options granted | shares | 75,173,492 |
Exercise price | ¥ 0.50 |
Fair value of option | 1.26 |
Fair value of ordinary shares | ¥ 1.72 |
Share awards granted on January 3, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options granted | shares | 112,760,238 |
Exercise price | ¥ 0.50 |
Fair value of option | 1.27 |
Fair value of ordinary shares | ¥ 1.72 |
SHARE-BASED COMPENSATION EXPE_6
SHARE-BASED COMPENSATION EXPENSES (Detail Textuals) | Jan. 03, 2017shares | Nov. 01, 2009$ / sharesshares | Nov. 01, 2009CNY (¥) | Jan. 24, 2011$ / sharesshares | Dec. 31, 2018CNY (¥) | Dec. 31, 2017CNY (¥) | Jul. 11, 2018$ / shares | Jan. 08, 2014$ / shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Total unrecognized compensation cost | ¥ 15,886,067 | |||||||
Weighted average period recognized or expected | 1 year | |||||||
Share price | (per share) | $ 0.0001 | $ 0.0001 | ||||||
2017 Share Incentive Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares granting options to purchase | shares | 187,933,730 | |||||||
Award vesting period | 3 years | |||||||
Terms of award | Years 2017 to 2019 | |||||||
2017 Share Incentive Plan | December 31, 2017 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Percentage of award vesting rights | 60.00% | |||||||
2017 Share Incentive Plan | December 31, 2018 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Percentage of award vesting rights | 20.00% | |||||||
2017 Share Incentive Plan | December 31, 2019 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Percentage of award vesting rights | 20.00% | |||||||
2009 Share Incentive Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares granting options to purchase | shares | 25,678 | 163,825,640 | ||||||
Award vesting period | 5 years | |||||||
Terms of award | from 2010 to 2014 | |||||||
Share price | $ / shares | $ 0.10 | $ 0.01 | ||||||
Exercise price | $ / shares | $ 3,190 | $ 0.5 | ||||||
Conversion ratio | 0.637 | |||||||
2009 Share Incentive Plan | January 1, 2010 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Percentage of award vesting rights | 60.00% | |||||||
2009 Share Incentive Plan | January 1, 2011 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Percentage of award vesting rights | 10.00% | |||||||
2009 Share Incentive Plan | January 1, 2012 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Percentage of award vesting rights | 10.00% | |||||||
2009 Share Incentive Plan | January 1, 2013 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Percentage of award vesting rights | 10.00% | |||||||
2009 Share Incentive Plan | January 1, 2014 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Percentage of award vesting rights | 10.00% | |||||||
Share awards granted on November 1, 2009 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Recognized compensation expenses | ¥ 16,435,974 | |||||||
Share awards granted on January 3, 2017 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Recognized compensation expenses | ¥ 39,715,168 | ¥ 182,689,766 |
MATERIAL RELATED PARTY TRANSA_2
MATERIAL RELATED PARTY TRANSACTIONS (Detail Textuals) | 1 Months Ended | 12 Months Ended | ||||
May 31, 2018CNY (¥) | Dec. 31, 2018CNY (¥) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | Dec. 31, 2015CNY (¥) | Dec. 31, 2015USD ($) | |
Related Party Transaction [Line Items] | ||||||
Amount of interest expense generated from borrowings | ¥ 610,405 | ¥ 8,714,000 | ||||
Total interest expense | ¥ 1,943,059,522 | 1,409,905,685 | ¥ 442,661,324 | |||
Fanhua Inc. and its subsidiaries | ||||||
Related Party Transaction [Line Items] | ||||||
Percentage of equity interests owns of CISG Holdings Limited | 100.00% | |||||
Fanhua Inc. and its subsidiaries | Jinghua Structure Fund 27 | ||||||
Related Party Transaction [Line Items] | ||||||
Valid term of contract | 10 years | |||||
Senior units | ¥ 115,000,000 | |||||
Intermediate units | 23,000,000 | |||||
Subordinated units | ¥ 15,350,000 | |||||
Total interest expense | ¥ 6,308,306 | |||||
Fanhua Inc. and its subsidiaries | Short-term debt | ||||||
Related Party Transaction [Line Items] | ||||||
Loan granted | ¥ 460,000,000 | |||||
Interest rate | 7.30% | |||||
Amount of interest expense generated from borrowings | ¥ 8,714,000 | |||||
Fanhua Inc. and its subsidiaries | Revolving loan | ||||||
Related Party Transaction [Line Items] | ||||||
Loan granted | ¥ 317,990,000 | $ 50,000,000 | ||||
Interest rate | 7.30% | 7.30% | ||||
Principal amount of revolving loan outstanding | ||||||
Principals and interests payable | ¥ 32,494,914 | |||||
Mr. Zhai Bin | ||||||
Related Party Transaction [Line Items] | ||||||
Interest rate | 0.02% | |||||
Loan agreement as lender | ¥ 5,010,800 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) | Dec. 31, 2018CNY (¥) |
Commitments and Contingencies Disclosure [Abstract] | |
2019 | ¥ 55,912,805 |
2020 | 31,600,761 |
2021 | 17,417,081 |
2022 | 10,701,271 |
2023 | 4,601,398 |
Later years, through 2025 | 5,247,712 |
Total | ¥ 125,481,028 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES (Detail Textuals) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Commitments And Contingencies [Line Items] | |||
Rental expenses under operating lease | ¥ 58,317,758 | ¥ 47,896,817 | ¥ 24,404,690 |
Maximum | |||
Commitments And Contingencies [Line Items] | |||
Initial period of operating lease | 3 years | ||
Minimum | |||
Commitments And Contingencies [Line Items] | |||
Initial period of operating lease | 1 year |
CONDENSED FINANCIAL INFORMATI_3
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY (Details) - CNY (¥) | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Assets | ||||
Cash and cash equivalents | ¥ 3,161,657,934 | ¥ 1,190,360,385 | ¥ 233,138,588 | ¥ 260,081,796 |
Total assets | 19,354,717,165 | 18,215,865,490 | ||
Liabilities and shareholders' equity | ||||
Other operating liabilities | 251,485,755 | 223,737,268 | ||
Total liabilities | 16,309,161,785 | 16,384,616,698 | ||
Ordinary shares (3,800,000,000 shares authorized, 1 share with HKD0.0001 as par value and 1,371,643,240 shares with USD0.0001 as par value issued as of December 31, 2017 and December 31, 2018, respectively) | 916,743 | 0 | ||
Additional paid-in capital | 921,703,448 | 569,125,240 | ||
Retained earnings | 2,127,501,707 | 1,266,592,996 | ||
Accumulated other comprehensive losses | (4,566,518) | (4,469,444) | ||
Total shareholders' equity | 3,045,555,380 | 1,831,248,792 | ¥ 1,118,686,418 | ¥ 1,078,703,169 |
Total liabilities and shareholders' equity | 19,354,717,165 | 18,215,865,490 | ||
Parent Company | ||||
Assets | ||||
Cash and cash equivalents | 319,807,618 | ¥ 0 | ||
Investments in subsidiaries | 392,559,403 | |||
Total assets | 712,367,021 | |||
Liabilities and shareholders' equity | ||||
Other operating liabilities | 8,158,984 | |||
Total liabilities | 8,158,984 | |||
Ordinary shares (3,800,000,000 shares authorized, 1 share with HKD0.0001 as par value and 1,371,643,240 shares with USD0.0001 as par value issued as of December 31, 2017 and December 31, 2018, respectively) | 916,743 | |||
Additional paid-in capital | 705,422,445 | |||
Retained earnings | (5,672) | |||
Accumulated other comprehensive losses | (2,125,479) | |||
Total shareholders' equity | 704,208,037 | |||
Total liabilities and shareholders' equity | ¥ 712,367,021 |
CONDENSED FINANCIAL INFORMATI_4
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY (Parentheticals) (Details) | Dec. 31, 2018$ / sharesshares | Jul. 11, 2018$ / shares | Dec. 31, 2017$ / sharesshares | Jan. 08, 2014$ / shares |
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Ordinary shares, shares authorized | 3,800,000,000 | 3,800,000,000 | ||
Ordinary shares, par value (in dollars per share) | (per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Common stock, shares issued | 1,371,643,240 | 1 | ||
Parent Company | ||||
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Ordinary shares, shares authorized | 3,800,000,000 | 3,800,000,000 | ||
Ordinary shares, par value (in dollars per share) | (per share) | $ 0.0001 | $ 0.0001 | ||
Common stock, shares issued | 1,371,643,240 | 1 |
CONDENSED FINANCIAL INFORMATI_5
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY (Details 1) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Operating expenses | |||
Total operating expenses | ¥ 746,716,443 | ¥ 897,573,320 | ¥ 467,924,938 |
Income before income tax | 1,157,737,186 | 808,667,625 | 288,045,262 |
Net loss | 860,908,711 | 532,672,757 | 235,441,839 |
Other comprehensive (losses) / income | |||
Comprehensive income | 860,811,637 | ¥ 529,872,608 | ¥ 39,983,249 |
Parent Company | |||
Operating expenses | |||
Administration Expense | (5,672) | ||
Total operating expenses | (5,672) | ||
Income before income tax | (5,672) | ||
Net loss | (5,672) | ||
Other comprehensive (losses) / income | |||
Foreign currency translation adjustment | (2,125,479) | ||
Comprehensive income | ¥ (2,131,151) |
CONDENSED FINANCIAL INFORMATI_6
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY (Details 2) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities: | |||
Net income | ¥ 860,908,711 | ¥ 532,672,757 | ¥ 235,441,839 |
Other operating liabilities | 240,699,389 | 691,081,484 | 2,077,066 |
Net cash provided by operating activities | 1,332,657,044 | 1,286,649,584 | 379,883,655 |
Cash flows from financing activities: | |||
Proceeds from initial public offering, net of offering cost paid of RMB51,967,702 in 2018 | 313,779,783 | ||
Net cash provided by financing activities | (2,548,924) | 9,256,740,263 | 4,291,087,461 |
Net increase in cash and cash equivalents | 1,971,498,464 | 959,497,192 | (29,444,229) |
Cash and cash equivalents at the beginning of year | 1,190,360,385 | 233,138,588 | 260,081,796 |
Effect of exchange rate change on cash and cash equivalents | (200,915) | (2,275,395) | 2,501,021 |
Cash and cash equivalents at the end of year | 3,161,657,934 | 1,190,360,385 | ¥ 233,138,588 |
Parent Company | |||
Cash flows from operating activities: | |||
Net income | (5,672) | ||
Other operating liabilities | 7,311 | ||
Net cash provided by operating activities | 1,639 | ||
Cash flows from financing activities: | |||
Proceeds from initial public offering, net of offering cost paid of RMB51,967,702 in 2018 | 321,930,733 | ||
Net cash provided by financing activities | 321,930,733 | ||
Net increase in cash and cash equivalents | 321,932,372 | ||
Cash and cash equivalents at the beginning of year | 0 | ||
Effect of exchange rate change on cash and cash equivalents | (2,124,754) | ||
Cash and cash equivalents at the end of year | ¥ 319,807,618 | ¥ 0 |
CONDENSED FINANCIAL INFORMATI_7
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY (Parentheticals) (Details 2) | 12 Months Ended |
Dec. 31, 2018CNY (¥) | |
Condensed Cash Flow Statements, Captions [Line Items] | |
Initial public offering, net of offering cost | ¥ 51,967,702 |
Parent Company | |
Condensed Cash Flow Statements, Captions [Line Items] | |
Initial public offering, net of offering cost | ¥ 51,967,702 |
CONDENSED FINANCIAL INFORMATI_8
CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY (Detail Textuals) | 12 Months Ended | |||
Dec. 31, 2018$ / shares | Jul. 11, 2018$ / shares | Dec. 31, 2017$ / shares | Jan. 08, 2014$ / shares | |
Condensed Financial Information Disclosure [Abstract] | ||||
Ordinary shares, par value per share (in dollars per share) | (per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Ordinary share percentage | 100% |